What Do We Do When the Property is Pending?
The word "pending" means that an offer has been accepted and we are either waiting for the inspection or the inspection has passed and now are waiting to close. Pending is the waiting time between making an offer and closing the sale.
A pending sale takes place after the seller has accepted the offer and the contract between the buyer and the seller has been signed. The property is no longer an active listing on the multiple listing service and the sellers cannot accept any other offers unless the buyer decides to pull out and terminate the contract.
Pending could also include the due diligence period. This is where the property has an inspection and public record check or title check is done to make sure there are no legal issues to selling the property. It could also start after this phase once the inspection report has been completed and satisfied.
Even so, a deal can fall through after all contingencies have been satisfied. If the financing doesn't go through or the home inspection reveals something that the buyer doesn't want to deal with, if the title reveals liens on the home or the appraisal does not match the offer, the deal could be terminated. So what happens during this time to the buyer, seller, and all parties involved?
Once an offer is accepted the buyer will prepare on therein finalizing any documents needed to the lender, title insurance, and schedule the home inspection. This is typically done within 7 to 10 days after mutual acceptance of the offer. The formal application for the loan is submitted to the lender and the lender will issue an appraisal.
Separately, the buyer will schedule a home inspection. This is a great way to gain insight into the property from the inspector. We encourage all of our buyers to accompany the inspector throughout the property understanding and learning as much as they can about the home they're going to purchase. Once the inspection is completed, the inspection report will be emailed or given to the buyer where they can review the report and negotiate any changes to the purchase and sale contract.
The seller can either agree to the changes or the buyer can accept the property as-is. At this point, is simply waiting for closing. The buyer needs to prepare their own home by packing and getting ready to move. It's important not to make any large financial moves at this time since your interest rate will be based on your current financial status. If that changes dramatically, it could upset the loan application and could possibly ruin their chances of getting a home loan at all.
The buyer should also conduct a final walk-through to verify the property is in the same condition or better than when they first saw it.
The buyer should keep in contact with their lender to make sure that they have provided all the right information and financial documents. Once everything is completed the buyers will be notified about the final closing. Escrow, title, or the buyer's real estate agent will notify the buyer about the final signing, when and where. Once the buyer and seller have signed the final closing documents, it typically takes anywhere from 1 to 3 days for finals closing. It is only after the property deed is recorded with the local county that the buyer can receive the keys to the property.
The seller actually has more time to relax during the pending process. They can simply start packing and prepare their moves. They don't have to be there during the home inspection and they really are just waiting and hoping everything works out perfectly on the buyer's end. The listing agent will schedule the inspection, appraisal, and any additional visits to the property but the seller may need to be present to let people in. However, while it's nice to be able to see the property before you purchase it, the seller is not required to allow the buyer in the property multiple times before closing. The buyer has already agreed to purchase the property so letting the buyer in for frivolous items such as measuring for furniture and such, is not mandatory.
The final step for the seller is to move out and leave the property in a clean condition. The buyer will typically do a walk-through a couple of days before closing so it's important to leave the property is clean and neat as possible. If the seller leaves garbage or destroys the property in any way, they will be liable and could ruin their chances of selling the property.
What if there are other interested buyers during the pending process?
Typically, the listing agent and seller will no longer accept offers once the property is pending. But deals fall through all the time so pending doesn't necessarily mean sold. Buyers may not submit a formal offer while a deal is pending but you can inform the listing agent that should the deal fall through, you have interested parties waiting in the wings. Don't get too attached though, as this is not a guaranteed way to find the right house. It is, however, an option just in case.
For more information on Columbus real estate, contact our agents today!