photos © Jonna Reilly Photography

Buyers

Phase I of Buying Process – Preparation

In this podcast, I will discuss the initial stages of the buying process. It covers the importance of selecting a team of professionals to assist you-primarily a lender and a real estate broker. It moves on to cover the pre-approval process, selecting a neighborhood, suburb or village, and the importance of subscribing to a listing alert program.

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Phase II of the Buying Process – Active Search

In this podcast, I outline the process of selecting a property and writing an offer.

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Phase III of the Buying Process – Escrow, Closing and Post Closing

In this podcast, I explain in some detail the process of what occurs after the business terms of a contract is accepted by the seller. I discuss the attorney modification/inspection period, the mortgage contingency period and what happens at the closing.

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Tips on Getting Pre-Approved

Getting pre-approved for a loan is an important step when preparing to buy a home, but it also can be a fairly simple process. Dean Vlamis is a mortgage broker who I recommend to my clients because he’s really great at explaining the process step-by-step and helping his clients learn how to avoid common pre-approval pitfalls during the process.

Time Line – From Contract to Close

Day 1 to Day 7

After the contract has been accepted by the seller and routed to all of the parties involved (buyer, seller, agents, attorneys and your lender), the buyer and their agent will schedule and conduct the inspection of the property. The buyer, inspector and both agents normally attend the inspection. An inspection will take around 2 hours for a 2 bedroom condo, 2+ hours for a larger 3 bedroom condo or townhome and up to 5 or 6 hours for a 5000+ sq. foot single family home. After the inspection is complete, it will take 24 to 48 hours to get the report back from the inspector. At that point, the buyer will schedule a call with their attorney to cover the report. The buyer’s attorney will use this information to complete the buyers attorney modification letter. This letter is normally completed within 24-48 hours after the inspection. The remainder of the attorney modification period is used to negotiate the inspection items and the fine print of the contract. An appraisal is also ordered by the lender during this time period. Most lenders wait until an acceptable inspection occurs before ordering the appraisal. The buyers attorney will request that a 22.1 disclosure is completed if this is a condominium or townhome purchase. Also, during this time, the seller will deliver all condominium association documents to the buyer (declarations/bylaws, budget, meeting minutes and insurance information).

Day 8 to Day 21

This time frame is used to finalize the attorney modification period if needed. Once the attorney modification period is finalized, the buyer will be required to submit the remainder of earnest money as negotiated as part of the contract. Total earnest money is normally 5%-10% of the purchase price. The lender will be requesting additional documents from the buyer and if it is a condo/townhome purchase, the lender will want to review condominium declarations and bylaws, budget and insurance information. By day 21, the lender should be approaching a full loan commitment.

Day 22 to Closing Date

The mortgage contingency as negotiated as part of the contract will be satisfied. As closing approaches, the lender and attorneys will complete closing documentation needed to conduct the closing. The seller’s attorney will schedule a closing with the buyer’s attorney. The closing normally takes place at a title company. The night before or day of the closing, a final walk through will be conducted by the buyer and both agents. The goal of the walk through is to verify that the property is in proper condition. If any inspection items were negotiated as part of the attorney modification, those items will be checked for completion. Within 24-48 hours of the closing, the buyer’s attorney will review an initial closing statement and inform the buyer the amount of funds needed to complete the transaction. If the funds needed for closing is over $50,000, the title company will require that the funds be transferred to the title company prior to the closing. Most closings are conducted 45-60 days after the initial contract is signed by all parties. A normal closing lasts about 2 hours.