The Sales Process

1. Making the offer
Offers are made on a New Jersey Association of Realtors contract with an initial good faith deposit and mortgage pre-approval. Once presented homeowners have 3 choices – accept, reject or send back a counter proposal. This system avoids any misunderstandings by spelling out everything in detail plus it expedites the process if you come to an agreement. It’s important to make a few points:

First, the offer you’re making is not a legal contract. It’s an offer on a contract form. It doesn’t become a contract until both you and the seller agree on terms and price, this is reflected in the written offer you present and the homeowner signs it. At that point it becomes a legal contract.

Second, your initial deposit is done by a check made out to my company’s trust account. New Jersey trust account law is very strict – it stipulates that we deposit your check in our trust account by the 5th business day after its written. If your offer is not accepted, your deposit is returned to you; if we reach an agreement, your deposit is used as part of your down payment or closing costs.

Third, New Jersey gives you the right to consult an attorney if the offer becomes a legal contract before it is binding. This protects both buyer and seller; in Bergen County we use attorneys to buy and sell real estate as soon as you are in contract on the house.

2. Negotiation
Once the owner receives your offer there are really 3 options: the offer can be accepted, rejected or a counter offer can be sent back to you. You have the same options when you receive the homeowner’s response. Sometimes you go back and forth only once or twice; sometimes it takes much longer. What’s important is to keep the communication flowing – taking an adversarial position never works. I will negotiate your offer to achieve the best terms I can for you; the final decision is yours to make.

3. Agreement
If your offer is accepted, any changes from your first offer are made and the document is sent to the homeowner for signatures. Once it’s signed, you now have a legal contract to buy the house.

4. Attorney Review
The first business day after the contract is signed starts the Attorney Review period. How long it lasts is up to the attorneys but it’s normally only a matter of a few days.

Attorney Review can be a little confusing – the mechanics of the law dictate that once you have a signed contract, any subsequent change invalidates it. As a result, attorneys cancel the contract you and the seller just signed so that they can change it to what they feel is right. Once all the changes are agreed upon and the revised contract is signed, you have a final, binding contract.

5. Inspections
Most residential sales contracts have two contingencies; the home inspection is one of them. Inspections are done immediately after Attorney Review. Most people inspect for structure, wood destroying pests and radon. You can inspect a home for anything you wish. Home inspectors are licensed in New Jersey; I can recommend several or you can choose your own. It is important to discuss inspections with your attorney.

A home inspection takes 2-3 hours or more. Please be there and follow your inspector through the house. He’ll give you a summary of his findings and send both you and your attorney a written report. Once you receive the inspection report, go over it with your attorney and decide if there are issues you want the seller to address.

If this is the case, your attorney will send a letter to the other side with your concerns and begin a negotiation based on the home inspection results. Most of the time buyers and sellers work things out and move on to the closing. If things don’t work out, the contract is cancelled and deposit monies are returned to you.

6. Deposit
Once the inspection contingency is satisfied, the deposit is normally due. Your attorney will instruct you on this and direct me to send your initial deposit to the seller’s attorney’s trust account (where deposit monies are held for the closing).

7. Mortgage Contingency
Unless you are an all-cash buyer, the mortgage is the second contingency. This should already be in process. However, most attorneys don’t order the bank appraisal, title and survey until after the inspection contingency is satisfied because they don’t want you to pay for this unnecessarily.

Your job is to get whatever documents your mortgage bank requires to the bank right away and to obtain homeowner insurance.

8. Utilities
About three weeks before the closing, please arrange for the utilities. If you plan for this early, you’ll avoid problems. I will help you with this by providing contact information – utilities don’t allow me to do this for you.

9. Final Checklist
A day or so before the closing, your attorney will give you the figure you need to bring to the closing using a certified check for any additional deposit that is due and closing costs. It is a good idea to bring your checkbook just in case there’s any discrepancy.
If anyone is taking medication, please bring one month’s prescription with you on moving day. And please don’t pack it so you have it available from the moment you arrive at your new home.

10. Final "walk-through"
The final "walk-through" is typically scheduled just before the closing. I will accompany you on this final inspection, which gives you one last opportunity to make sure that the home about to be turned over to you is in the condition that you and the seller mutually agreed to in the sales contract.

Should a problem exist, we’ll call your attorney immediately. Sometimes by the time you arrive for the closing your attorney has already worked things out. Sometimes you negotiate it at the closing. Sometimes this can delay the closing. Heed your attorney’s counsel on this.

11. The closing
At the closing, you will first close on your mortgage and then you close on the house. Your attorney will go over all the documents and explain everything to you. Just relax – if you have any questions, ask them. Make sure you understand everything fully. You will receive a settlement statement where all figures for both buyer and seller are delineated. The seller gives you the keys to your new home and you are now a Bergen County resident!