FAQ for Buyers
That depends on you and your broker. The listing broker will offer a percent or dollar amount to a cooperating broker (that would be your broker). When the transaction closes/records, then your broker is compensated that amount. If you signed a buyer/broker agreement, you might have to pay depending on how the agreement is written. Your broker may ask for a certain percentage/dollar amount from you at the close of escrow. If the compensation the listing broker is offering is at least the agreed upon amount then you pay nothing, else, you make up the difference. Your broker may also indicate they require only the compensation offered by the seller as stated in the multiple listing services.
You can, or you can ask the seller to do so. Even if the seller pays, you can ask for a specific inspection company. Usually, the buyer winds up paying for any and all inspections as a matter of trust. Sellers could have done pre-listing inspections providing the findings to you. You can choose to rely on them or hire your own inspectors. The seller cannot prevent you from doing any inspections you deem necessary, though you will most likely pay. Make sure to budget for these inspections.
No. Down payment is part of the purchase price that your lender requires. Closing cost are recurring and non-recurring cost having nothing to do with the actual purchase dollars. Examples of some closing cost would be insurance, taxes (recurring) and one-time cost(non-recurring) that are required to close the transaction, such as escrow/title fees and loan origination fees.
Yes. You cannot obligate the seller to sell their home. If no justification, then there are remedies you could persue. Talk to your broker and legal counsel. If the seller cancels the transaction because you failed to perform, then the seller is entirely within their rights to cancel.
Technically, the California Association of Realtors contract states 6 pm on the day the transaction records. Be aware that is not the same day as signing closing documents. I generally give the keys to the new owners once I receive notification from escrow that the transaction has recorded, which can be anytime during a day.
FAQ for Sellers
Yes, they can. You cannot force someone to buy your home. Depending on where in the process will dictate whether or not it is a breach of contract. If it is, then there are legal means (mediation, arbitration or trial) to mitigate the breach. If not, then the contract has language that will define the legal process for canceling the contract and return all parties to presale position, excluding selling and purchasing expenses. Your broker should explain the differences.
No, you do not. Everything is up for negotiation. Repairs or lack of can be negotiated up front before the contract is accepted, or at the time the buyer presents you with a request for repairs. I strongly recommend attending to health and safety issues.
Commissions are always negotiable. Brokers may have guidelines for their agents, but a commission is never fixed. You will negotiate the commission, plus, how much of it to offer to the cooperating broker (buyer’s/selling broker).
That will depend on what is negotiated up front before accepting the offer. The contract used by agents who belong to the California Association of Realtors has the option of choosing who pays for an item that would be considered part of the closing costs. The buyers will request which items they would like the sellers to pay in their submitted offer. Have your broker representative explain. Also, some agents will tell you there is a standard, by county, dictating which principle pays for what. Not binding. If you don’t want to pay for something, then counter the offer.
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