Recently a viewer emailed and asked a couple of very good questions that I thought I would share with everyone....
by Diane Eddy-Low with The Hermann London Group, Maplewood
Generally speaking, when buyers present an offer to purchase, they can include a contingency for the sale of their house. This is known as a "contingent contract." In simple English, this means that if the specified event does not occur -- in this case the buyers do not sell their house -- then the contract to purchase the new property becomes null and void and the purchasers are entitled to a full refund of any earnest money deposit.Needless to say, sellers do not want to take their house off the market for an indefinite period.Accordingly, a compromise has been developed, which is known as a "kick-out" clause. Under this arrangement, the sellers add language to the real estate sales contract stating that while they are willing to accept a contingency contract based on the purchasers' selling their current house, the sellers will continue to market their house. If another qualified buyer is found, the seller will give the current purchaser a certain amount of time -- usually 72 hours -- in which to remove the contingency (i.e. keep the contract alive) or exercise the contingency and decide not to purchase the new property.
Therefore if the contract does not have a "kick-out" the Seller can not market their property and will have to take the chance that the Buyers will be able to sell their property in order to complete this transaction with-in the agreed upon time. If not the Buyers receive their earnest deposit back and the Seller puts the property back on the market having lost weeks or months of marketing time.
What is a CMA: (Competitive Market Analysis)
This is a report that is done for a seller or even a Buyer to give an opinion of value for a home. We look at the subject property to see what it offers; size, beds, baths, garage, lot size, age, basement finished or full, yard size, fencing, any updates to the home and the type of heating and air conditioning. We Realtor's then take that information and search for similar properties to our subject property that are located in the same area with similar characteristics that have sold in the last few months. From that information we are able to create a report that shows what the opinion of value is for the subject property!
Many thanks to skwaun for such great questions!
If you need assistance with a Real Estate matter please contact me!