This is probably one of the first questions you want answered when you submit an offer.
When will the seller get back to me?
When do I have to wire my earnest money?
When do I have to release my contingencies?
When do I have to wire my down payment?
When do I close??
Unfortunately, this can seem complicated because the real estate industry can feel shrouded in mystery. We can help bring some clarity based on what we know about industry standards and local regulations.
Here are the key milestones in the closing process. Keep in mind that these deadlines should all be outlined in your closing process, so be sure to reference your document for the exact deadlines.
Usually 3 days after offer/counter-offer is sent.
Once you send an offer to the seller, the seller usually responds within a few days. In some states, if the seller doesn’t respond within a certain amount of time, the offer is no longer valid. You can specify your own deadline as well.
Once the seller accepts your offer, or they provide a counter-offer that you accept, both parties sign a Sales & Purchase Agreement (SPA). This stipulates that you and the seller are both legally bound to go through with the transaction, hinged on the contingencies outlined in the offer.
Usually 3 days after offer is accepted.
Earnest money is a deposit that is on the line if you, the buyer, violate the SPA you just signed. Your offer to the seller, or the seller’s counter-offer to you, will stipulate how much and by what date the “earnest money” must be deposited into an escrow account. This varies by local regulations, but is usually 1-3% of the purchase price. It usually must be deposited within 3 days of the offer acceptance. You can still get this money back if you want to back out of the transaction and have not dropped all your contingencies.
Usually 7 days after offer is accepted.
After offer acceptance, the seller must send you a disclosure packet, which consists of a several documents that outline facts about the property that the seller is aware of. This includes a variety of reports and is often a pain to read through, as it can be hundreds of pages. The seller must send this to you within a time specified in the offer, which is usually about 7 days.
Usually 2 weeks after offer is accepted.
Your offer defines a due date for all your contingencies. It is common for your inspection contingency to be due within a couple of weeks. By this time, you should have got any inspections on the house done. You can back out of the transaction without losing your earnest money as long as any of the contingencies are still not released.
Usually 2 weeks after offer is accepted.
Your title contingency is also usually due within a couple of weeks, but you can specify a different date. By this time, you should have got a title report from your title company and verified it looks good.
Usually 2-3 weeks after offer is accepted.
The appraisal contingency is also required for the loan to be approved, as if the house is appraised at a lower value than your offer price, the bank will not finance the full offer price. The appraisal contingency is usually due within a few weeks.
Usually a few weeks after offer is accepted.
Actually getting your loan approved is a fairly intensive process, usually requiring a number of pieces of evidence that prove you can pay the loan you are applying for. It is common for your loan contingency due date to be a few weeks after offer acceptance.
Usually a few days before end of closing.
A few days before your scheduled closing date, you are expected to do a final walkthrough. This basically signs off that the property is in the condition that you expected.
The day of closing.
For the transaction to complete, your downpayment will need to be put into the escrow account so that all funds can be disbursed to the seller when the final purchase agreement is signed. The downpayment should be in the escrow account by the day of closing, or closing could get delayed.
The day of closing.
By the day of closing, all parties sign the closing documents. This includes getting notarized, signing the loan documents, and transferring the title.
The property is now yours!
There are a lot of steps involved in this process, and we've only detailed some of the major items. There are more things to take care of, such as getting homeowners insurance. It can get overwhelming and confusing. However, Bramble can help you understand your unique closing timeline and manage changes to it so that you can stay on top of it. No agent needed. Let us know if you're interested!
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