A binder is a written agreement to sell a house signed by the buyer and the home seller. It is usually supplied by a realtor, and a small payment, such as $100. It is delivered by the seller (this is not to be confused with the down payment). Some binders contain provisions allowing the binder to be subject to the approval of the person’s attorney, some do not. The binder may be legally "binding," and bind the home seller to terms unwisely. The home seller should consult their attorney before signing a binder.

A home seller needs to know what their house is worth. They need to know before they list it for sale and before they agree to sell it. Home sellers seeking to sell by owner, without a realtor, especially need to determine their home’s value. A realtor can estimate the value, a licensed real estate appraiser may make a more specific evaluation.

The real estate contract is negotiated between the attorneys for the home seller and buyer. Although there are many terms and clauses which are standard to most real estate sales, the contract is adjusted to the specific facts of each transaction. The contract establishes the identity of the parties, the purchase price, the condition of the house at closing, the amount of the down payment, what occurs in the event either side breaches the contract, the expected closing date, and many other things.

The title report, obtained by the buyer’s attorney, sets out the legal history of the property to prove that the home seller owns the property free and clear. It searches for any liens on the property, including judgments. Title insurance is obtained by the buyer at closing to ensure they are acquiring the property free and clear.

The survey is a document mapping out the property to be sold, setting out the house in the property, fence lines, and all structures currently on the property. The survey should become part of the title report. If an old survey is used, the firm providing the title report should send an inspector to the property to determine if the structures and conditions at the property have changed since the date of the old survey.

Mortgage is a loan used to pay a portion of the purchase price of the house. The homeowner agrees to pay back the amount of the loan, with interest, over time. There are a great many different kinds of mortgages and a homeowner needs to very carefully investigate the specific terms of the mortgage before agreeing to it. The expenses associated with a lender vary greatly from lender to lender. An attorney should be consulted before a borrower settles on a mortgage.

There are several tax obligations which may be triggered by a real estate transaction in New York state. The seller may have to pay income taxes on a profit earned on the sale of the property. The seller also must pay a transfer tax (similar to a sales tax) of four-tenths of one percent of the sales price. (Thus, if the sales price is $100,000, the seller pays $400 to the state of New York.) The seller also pays for recording documents such as the satisfaction of a mortgage. The home buyer pays taxes for taking out a mortgage of approximately three-fourths of one percent of the amount borrowed. (For a mortgage of $75,000, the borrower pays a tax to record the mortgage of $725 to the state of New York). The home buyer also pays various fees to the county to record documents, such as the deed and the mortgage.

The deed is a document whereby the home seller formally signs over ownership of the property to the buyer. The deed must then be recorded with the county clerk of the county where the property is located. Although the deed should be kept in a safe location, the homeowner does not need the original in order to sell the house, so long as the original has been properly recorded. A deed should be prepared by a lawyer, an improperly drafted deed may cause the homeowner problems when the property is to be later sold.

There are several kinds of insurance which may be involved in a real estate transaction. Homeowners insurance protects the owner against damage to the property and liability to persons who may be injured on the property. Homeowners insurance should be in effect by the seller until the date of closing, and the buyer should have a policy in place on the date of closing. Title insurance is insurance obtained by the buyer to ensure that they are receiving the property with clear title. Mortgage insurance is paid, in some cases, by the buyer. It protects the lender in cases where there is low equity in the property because the mortgage paid most of the purchase price.