Step 1: Deposit earnest money
The sum gets applied to the buyer's closing costs/down payment and is refunded too should the inspection go poorly. Usually within two days of mutual acceptance. It goes to the escrow company, check made out to the same. Normal earnest money amounts are $500-1000 but depends on purchase price.
Step 2: Your home inspection
We usually have 5-10 days to conduct our home inspection. We will want to contact a home inspector within the first couple days to get them scheduled. They usually run $400-450. You are encouraged to attend the home inspection, and we will always be there. Here are few names of qualified and
licensed home inspectors for our area. You can use one of these inspectors OR one of your choosing:
Inspection Findings Review
After we receive the findings and wish to proceed, we may do so as-is, request a price reduction, or make a repair request. The negotiation may go back and forth a couple times with the seller until we reach agreement. Sometimes the findings need further evaluation, so we have relevant contractors come and give their determination on work needed and costs involved before negotiating with the seller.
Step 3: The Appraisal
The lender orders the appraisal within the first 10 days of acceptance. We receive the due date (day by which report will be submitted to lender).
After reaching agreement on the inspection findings, the lender will order the appraisal. It may be 2-4 weeks before the appraisal is submitted, and this part is generally the longest wait – and the reason closings are
30-45 days! The lender will tell us when the appraisal is received. The majority come in “at value” with no work conditions. If there are a few conditions, like replacing a piece of rotten
wood, touching up peeling paint, etc., we work with the seller(s) to have them addressed before closing. If the appraisal comes in below value (aka below agreed-upon purchase price), there are a few options:
-The seller comes down to the appraised value.
-The buyer bridges the gap by putting more cash down.
-The seller and buyer meet in the middle somewhere.
Step 4: Signing
This takes place at the escrow company 1-2 days before close date. Escrow will contact you to arrange and you will bring the required funds to close.
Step 5: Recording
Recording happens in the evening of closing day and is when you become the official, legal owner of the home.