This is the timeline you have to satisfy all of your loan conditions, as well as property inspections. Sometimes known as your ” Free Look”. Obviously, inspections cost money so expect to have out-of-pocket expenses during your contingency period. You will pay for a home appraisal & that will be ordered by your mortgage banker. We will help facilitate a home inspection, roof inspection, and any other inspections needed to satisfy your due diligence process. Any issues on the termite report will be investigated, and any problems on the home inspection report will be asked for a remedy. Homeowner’s association (HOA) documents will be delivered, as well as the list of disclosures and reports asked for in the RPA.
1. Home inspections and repairs: it is a request for repair, not a demand. Sellers are under no obligation to do anything at this point, but it behooves them to keep the deal together if things are going well. Two options are available. The seller remedies the issue, or gives a cash credit at close of escrow.
2. Appraisal. One of two outcomes is possible. The property appraises at purchase/higher than purchase price: excellent! Property appraises below purchase price: bummer. Appraisers can miss things, and second opinions can be granted. A few options are still available to make the purchase work out, and it is a case by case basis on how to approach a solution.
3. Loan conditions. Are you still employed and credit worthy? Is the house fit to be collateral for the mortgage lender? A few of the things that are investigated during this part of the process. This is not the time to buy a new car or get a new credit card. Or make large deposits or withdrawals from your accounts. Everything you do from a financial perspective will be analyzed during the escrow process. Be mindful.
4. Home owner insurance. Can the home be insured, and if so, how much will it cost? The NHD Report that we request of the seller is a report that will help determine the insurability of the home based on it’s location. It’ll determine if you need additional policy on your new home. I.e., Fire or Flood zones.
5. Title. What liens are against the property? Is the seller’s title clouded? Before the close you will be given clear title but it’s important to know what’s on title to help avoid any unforeseen circumstances at the 11th hour of the transaction.
If there were any addendums included in your purchase contract, like a short sale or a contingent of sale then you’ll want to make sure you satisfy these terms as well before you remove your contingencies which would make your deposit “hard” & you’d be “all in”. There’s much to consider during the contingency period & it’s important that you have a professional on your side to help guide you through the process.
We at 1850 Realty are happy to share information about the home buying process. Transactions can vary individually, and we are here to help you with your real estate needs. To discuss in more detail, don’t hesitate to contact us:
Next article in this series: Contingencies Removed