Just how important are those dates in real estate?
In my neck of the real estate woods, Southern Litchfield County, we can do things one of two ways when you make an offer on a home. We can use an offer to purchase or an actual contract form when presenting the offer.
So what is the difference? Is there a major difference between an offer to purchase and a contract form?
Yes, there are very important differences. The first is an offer to purchase, which will be followed up by a formal contract written by the sellers attorney. Usually the attorney will wait until the inspection contingencies are met and any issues are resolved, which is about two weeks.
During that period of time the house is placed "under deposit" in the multiple listing service and other agents may show it to interested parties. Usually that doesn't happen, but it is a possibility.
Second is to use some sort of actual contract form to write up the offer. We have a few different forms available for us to use, and they are all basically the same. But once signed by both parties, is it a fully executed contract of sale. The home should be marked "sale pending" in the multiple listing service right away, which removes it from the active rolls.
With both you will submit a binder (typically 1% of the offer price) with your agents brokerage or the sellers brokerage.
That check will be deposited, by law, within 3 days of the offer or contract being signed by both parties into the escrow account of either the buyers broker or the sellers broker. Your deposit will be forwarded directly to the sellers attorney, which should happen within a few weeks, after your check clears. In the case of using an offer to purchase, it will be sent to the sellers attorney after you sign formal contracts.
With both, there are all important dates. And remember, if you used a contract form, those are contractual dates right from the start!
Important real estate dates:
Inspection contingency date
One thing to consider, you have to think about not only getting the inspections done, but the results back to you and requests for repairs or credits (if any) within the time line in either the offer to purchase or the actual contract! This means your agent must consider if the inspectors have time to get the reports back to you in time!
If you pass the date without asking in writing for an extension, the period has passed and you just might be out of luck!
I have seen this happen, and it has had serious consequences. You are in contract, you wait until 2 days before the inspection contingency date expires to have inspections done, you get the reports AFTER the inspection contingency date expires and there are issues. The seller does not have to respond to your requests in any way shape or form if they choose not to because... you broke your date!
Deposit date
If you are making a deposit on the home in addition to the original binder check, keep an eye on that date. If you used an offer to purchase you will be making that deposit upon signing formal contracts. If you used a contract form, make sure you know exactly when you are required to get that deposit check in!
Mortgage contingency date
You must pay attention to this date, working closely with your lender to hit this date. I always check with the lender before writing up an offer to see what time frame they need in order to adhere to the mortgage contingency date. Always. And these days I see more requests for mortgage contingency extensions than I care to think about. These requests are made by the buyers attorney to the sellers attorney, in writing.
Closing dates
Although I tell my buyers AND sellers the closing date is more like a target date, depending on the language used in the contract missing this date can have serious consequences. Sometimes there are monetary consequences, the buyer is expected to pay extra for each day they extend the closing date! Make sure you know if this is the case. Typically we see this in a foreclosure, not a regular sale.
Sometimes the closing date has to be moved because of the mortgage, sometimes because one of the attorneys cannot be present due to a court date or other obligation. Sometimes moving this date is possible without repercussions, sometimes moving it may cost you. Just know up front.
Breaking these all important dates can have serious consequences. It can cost you money, it can cost a sale. My best advice? Keep track of them yourself, don't just rely on your agent or your attorney to know the dates.
Don't break those real estate dates, write them on your calender and make sure you show up on time!
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