By Jonathan Duerr, Senior Real Estate Professional with William Raveis South Florida
In the first article we talked about how it is a great time to buy and sell Real Estate here in South Florida.Rates are low and prices have not skyrocketed making it a great time for home ownership, while inventory, making it a great time to sell if you were ever on the fence about it before. Last month we discussed the importance of getting a home inspection, even if it means missing out on a deal, but also how to strengthen that offer to overcome that inspection contingency. So now that we have agreed on terms with the seller, now what? What happens after we lock in that house we have been looking for and fighting for? The process of buying a home can be a little scary or nerve wracking especially if it is your first home, but it really does not have to be. There are fundamental steps which I will walk you through now that hopefully will take a little pressure off you. Now granted, these time frames can be different with every transaction, the terms will stay the same, so let us go in order of terms and timeline:
- Executed Date – This the date that both parties agree on all terms and execute/sign the contract. This is when the purchasing process begins, and the clock starts.
- Initial Deposit – Typically the initial deposit is due 3 days after acceptance or executed date on the contract. This is usually a 5-10k deposit held in escrow to confirm the contract.
- Time of Inspection – You typically have 7-10 days from executed date to get a professional inspection of the property and do your due diligence. If the inspection comes back and you do not come to terms with the seller on repairs or replacement costs, you can cancel the contract and receive your deposit back in full. In fact, during this time and for whatever reason, the buyer can cancel the contract and receive the full deposit, no questions asked.
- Additional Deposit – Once the buyer agrees that inspection and any possible requests are sufficient, an additional deposit is now due to once again, firm up the contract. This is typically the remainder of 10% of the purchase price, or whatever you are putting down for your mortgage.
- Loan Commitment – If purchasing a home using financing, the contract requires you to obtain a loan approval/commitment typically within 25-30 days of the executed date. If for whatever reason this commitment or approval cannot be met; you lose your job and do not qualify anymore, the home doesn’t appraise (which we talk about next time), or something catastrophic happens, then you will receive both of your deposits back in full.
- Closing Date – In today’s competitive market we are seeing closing dates of 30-45 days with financing, and as soon as 14 days for cash deals. This is the day both parties sign the necessary documents and the new owners take ownership.
Throughout my 16 years in real estate I have helped clients in all aspects including buying, selling, investing, and renting homes, and I have become fortunate enough to call this my passion and not just my career or job. The home buying/selling process to me is much deeper than a mere transaction, it is helping with one of the biggest decisions in life, which we can now all agree has become much more than just “where the heart is.” So, whether you are thinking of buying, selling, or renting a home, or simply curious about the market and have some questions, please do not hesitate to reach out. Until next time!