It is very difficult for a seller to back out of a North Carolina real estate contract, so think carefully before signing on the dotted line and be smart about what offer you accept.
I advise not considering a contract that is contingent upon the sale of a home that does not already have a contract on it. Your buyer may not have properly prepared their home for sale, and/or may be unrealistic about asking price. Sometimes a seller will accept such an offer, while retaining the right to continue marketing their property, while giving the buyer a 48-hour notice when another offer is received to either terminate their offer or drop the contingency. This will not help much because the Triangle Multiple Listing Service will require you to list your property as “Active-Contingent”, which will reduce your showings by 75%. In the case where the buyer’s home is already under contract, it depends upon how good the contract is. Have your broker contact the listing agent for the buyer’s home. If everything looks solid, you should feel good about moving forward.
Make sure the buyer’s financing is in good shape. Certainly ask for a pre-qualification letter, but I also recommend having your broker ask permission to contact the buyer’s lender to see how much research the lender has really done.
For homes below $250,000 it is very common for buyers to ask for “seller paid closing costs”. Think of these as “buyer-financed closing costs”, and when considering an offer, mentally subtract this amount (found in section 10 of the North Carolina Offer to Purchase and Contract) from purchase price on the first page of the offer, because that is the price the buyer is really offering you, and negotiate accordingly. The buyer often needs this money to purchase your home because they do not have enough cash to cover both the down payment and closing costs such as inspection, appraisal, loan origination, etc. The risk to the seller is that the home must appraise for the total amount, including the closing costs. If it does not, the buyer will ask you to reduce your price to the appraised value (still including closing costs), and if you refuse they might be unable to close.
