Step 1: Offer Accepted
Some find their dream home immediately while others need more time. Either way, the home buying process is the same. It all starts when the buyer’s offer is accepted by the seller. Remember that the acceptance of an offer needs to be signed by both parties. Earnest money is a deposit that must be put in an escrow account. The deposit is kept in the account till the property is officially sold. This shows that the buyer can afford the house and won’t change their mind. If the buyer does change their mind, the seller is allowed to keep the earnest money.
Step 2: Disclosures and Inspections
The seller must give the disclosure statement to the buyers. The disclosure statement states any known conditions or risk associated with the home. The buyer needs to sign the statement to show they have read and understand.
The buyer can choose to have a licensed inspector view the home. There will be a specific time period that the buyer is able to get the inspection completed. This period is called the inspection contingency date. With this contingency, the buyer can adjust the sale price based on what is found. If the buyer and seller cannot come to a negotiation the buyer can walk away with their earnest money back.
Step 3: Closing Process
The buyer agent will give the final amount to bring to closing (usually held at a law firm). Most closings ask for a cashier’s check. The buyer needs to do a final walkthrough of the home to make sure it the property is in the same condition. At closing, the buyer and seller will sign all closing documents such as the HUD. The HUD lists all costs each party needs to pay. A closing statement is needed if the buyer is using a loan to purchase the home. The closing statement shows the purchase price, credits (such as taxes and earnest money), and the amount due to the seller. The Seller will need to update the abstract. The abstract is the title to the property and lists deeds and mortgages. It also shows the history of the land. The seller is in charge of paying for the update. Once everything is signed the attorney at closing will record the transaction and updated deed.