The agreement
The Agreement of Purchase and Sale is a contract that outlines all the legal details of your sale. It serves as a roadmap for what needs to happen and when — it will often include a home-inspection and financing deadline, a closing date, a deposit amount, and other conditions such as inclusions in the sale. It also includes the standard clauses common to all Agreements of Purchase and Sale in the province.
Deposit and financing
First, the buyer sends in the specified deposit amount, which is held in trust — typically at the real estate office — and forms part of the down payment on closing. Should something happen that impedes the sale, where a condition is not met, they would get this back. Then the buyer schedules their home inspection and sends their documents to their bank or broker to arrange financing. These steps typically happen a couple of weeks after the offer is accepted, but the specific deadline dates are in the offer itself.
Home inspection
When the buyer has their home inspection, they will often meet the inspector at the house afterward to go over the results. They have until the deadline specified in the contract to provide any pertinent results to the sellers that may need to be dealt with. It’s important for sellers to be proactive before the inspection — make sure the property is clean and disclose any known issues upfront to make for a smoother inspection.
Firm sale
Once the buyer gets their financing letter in, the inspection is completed, and any further negotiations are done, you usually have what we call a firm sale. After that, it’s important for sellers to prepare for closing by removing whatever is not included in the contract and completing any agreed-upon repairs. You’ll need to get in touch with your lawyer, who will liaise with the buyer’s lawyer on things like the title search and survey. In Newfoundland, the closing date often gets delayed, so it’s important to keep this in mind. The sale is subject to the buyer getting insurance and a clear title, often compliance from the city or town, and a good survey or real property report if a new one is required — a lot of this may happen near the end.
Closing
On the contract closing date, the buyer and/or their agent will do a final walkthrough to confirm everything is as it should be according to the contract. At this point the seller should be totally moved out. If the date gets moved, they may do another walkthrough each day until the house closes. Once closed, the buyer’s agent releases the keys and the house belongs to the buyer.
Congratulations — you’ve successfully sold your house! If you’re thinking of selling, get in touch and we can set up a no-obligation meeting to discuss the best way forward.
