Earnest money is not required as part of a real estate contract, but it is highly encouraged. Including earnest money with your offer lets the seller know that you are serious in completing the purchase of the property. That money is credited to the purchase price at closing, but there are possibilities of losing the money if you withdraw from the contract under certain terms. Your real estate agent can guide you as to those consequences and how to make a decision on the amount to include with your offer.

Home inspections are also not required as part of a real estate contract (sometimes a lender may require it), but it is another factor in purchasing a home. Homeland Realty strongly suggests to all buyers, to hire an inspector. Alabama is a “caveat emptor” or buyer beware state. This means that sellers are not bound by law to disclose any information about the property beyond defects that are related to the health & safety of a purchaser. It is important to have a home inspection and ask as many questions as possible that are of a concern to you. Be sure you know what the sales contract says about the home inspection process and discuss with your agent how to negotiate through the findings of an inspection report. Need an inspector? Click here to access a list of inspectors we recommend!

An appraisal will be required when using a lender and it is usually required to be paid for prior to closing and at the time of the service rendered. Cash sales do not require an appraisal, but can be included as part of the contract to purchase. If financing, the appraisal process will be initiated by your lender. As a cash buyer, it will be your responsibility to hire the appraiser and negotiate the results of the appraisal report. Make sure to discuss this with your agent before finalizing the offer contract! Click here to access a list of appraisers we recommend!

A survey may sometimes be required by a lender, or a purchaser might require one if paying cash. Either way, it is usually an expense that is paid prior to closing out of the purchaser’s pocket. Surveys can be very expensive, so this can add a substantial amount of money needed to purchase a property. It can be a negotiable item in the contract and a seller might have a recent one that they can provide. Be sure to discuss this with your real estate agent and be prepared for the expense if a survey is important to you.

All other expenses are generally included in the closing costs that are paid for at the closing table. Click here to find out more about those costs.