Finally your home hunting search is over! You have found the right home and the sellers are ready to hand you the keys! Well, almost, but not exactly just yet. Let's walk through the basic steps so that you are well informed and ready to move easily through this exciting process.
Accepted Offer - The Binder
Once the final offer is accepted, both sides should sign the paperwork. Along with your 1% offer check, all signed disclosures (property condition, lead paint, possibly mold and foundation) and your loan approval letter are collected into one packet, along with the purchase agreement and this packet becomes the executed binder. Your agent will forward this to your attorney and your loan officer. The wheels are now set in motion for a series of next steps to follow to get everyone to the closing table within typically 30 to 60 days. During this time, the listing agent will switch the status of the home on MLS from ‘Active’ to “Continued to Show’, which designates that the home can continue to be shown but has an accepted offer. It is important that you and I keep things moving so that we can get to the first hurdle of contract signing and remove the home from the market!
Home Inspection You will arrange for an inspection usually within 5 business days of the executed binder. I have several recommended inspectors but you are free to choose who you like. The home inspection typically includes the building, radon and pests. Other items if featured in the home will include an inspection of the septic, private well, pool, tennis courts and any other structural features. The inspection will typically last 2-4 hours depending on the size of the home. I highly recommend you click HERE for a detailed description of how to prepare and what to expect from the inspection.
Contract Signed – Under Deposit Once the binder has been executed, your seller's attorney will draft the contract and forward it your attorney. Meanwhile, the inspections are completed and any repair requests are negotiated, agreed to and finalized in an addendum. This repair addendum is also forwarded to your attorney for signing. At the time of signing, you will typically put up the full 10% deposit. Contracts are then returned to the seller's attorney for their final signing. Everyone’s goal is to move toward an executed contract, typically within 10 days of the executed binder to stay on track. This step switches your property to ‘Pending’ also called ‘Deposit’ and removes your home from being shown to other potential buyers.
Home Appraisal and Mortgage Contingency If you are paying cash, there is nothing to do while the seller's address any of the repairs required and you can start packing. However, more than likely you are going to obtain a loan to purchase the property. Most transactions have a ‘mortgage contingency’ built into the binder and contract. This contingency states that if for some unforeseen reason you cannot obtain financing, you are not bound to purchase the home and your deposit is returned. In order for your lender to validate the sales price of the home (in case of default), they set up an appraisal. Depending on the size of the home and the lender, the appraisal might entail a home visit or it might just be a drone view, exterior only ‘drive by’ or computer validated appraisal. If there is a visit to the home, one of the agents should accompany the appraiser. We like to get this appraisal done within 2-3 weeks following the executed binder. Once the appraisal is done, the loan team begins to request further documentation from your to complete their underwriting process. At the final stage of the application, you will obtain the lender's formal ‘commitment’ that your mortgage will be executed. This is the last major hurdle and we all eagerly awaiting this letter so that the mortgage contingency is released and you in ready to close.
The Home Stretch By now there are only a few details remaining such as firming up the mutually agreed to closing date. You will confirm the date with your movers and be well into packing up your belongings. Your agent will provide a Moving Checklist for you to make sure you don’t miss small things such as postal forwarding and utilities cancellations. Other 'To Do's' such as obtaining home owner's insurance will already have been done thanks to the list of conditions set by your lender.
Either the night before or the day of the closing, we will go back to the home for a final 'walk through'. Your agent and attorney will have already collected all the necessary paid invoices from any repairs and confirmed whatever items needed to be addressed prior to closing. This walk through is really just a formal step to ensure nothing unusual has happened and the home is broom swept and completely emptied.
The Closing Table
The final closing is usually held at the seller's attorney’s office and typically, this is done with the attorneys only. You will have already met with your attorney and signed a plethora of documents earlier in the day for closing the loan and purchasing your house. The seller have signed documents as well with their attorney. The exchange of title and documents is done with both attorneys and you will likely get a phone call or email once everything is completed. Though this might seem a bit anticlimactic by now, don’t underestimate your accomplishments! Final congratulations are in order and time for celebration! Your new life chapter begins NOW!
Comentários