Real Estate Inspection and Final Signing and Closing
After the initial negotiations on the purchase and sale contract have been satisfied, the contract moves on to "subject to inspection". While it is not mandatory to have a professional inspection completed on the purchase of a home it is strongly recommended and encouraged.
Consider it this way, you probably wouldn't invest hundreds of thousands of dollars into a stock that you know nothing about. You would invest, inspect, and learn as much as you can about the investment. You need to consider real estate this way. Find out all you can about your purchase in order to make a wise investment decision. The best way to do this is to have a professional inspection completed.
Read more: A Home Buyers Checklist
Many first-time homebuyers try to save money by having a friend or family member conduct the inspection. But, unless they are a professional inspector, the report may not be valid and sellers may decline the report and any repairs that are needed. It's best to have a professional inspector, one in which knows the properties and real estate for their area, look over the entire home offering tips and suggestions as well as repairs and advice on the structural integrity of your potential new home.
After the inspection is complete, which takes anywhere from 2 to 5 hours, the inspector will offer you a temporary report and either email or mail you a full report on the property. This is the report you will use in order to negotiate any changes on the property with the seller. The seller will want proof that these changes are required or suggested by a professional inspector.
At this point, you will work with your buyer’s agent and write up your decision on the inspection. As a buyer, you have four choices; decline the inspection and terminate the transaction, ask for money off of the purchase price in order to cover repairs, ask that the seller conduct the repairs with professional proof, or accept the inspection as is and move the transaction on to closing. You don't have to ask for anything even if there are issues that need addressing. It is up to you whether you choose to move forward with the transaction or not. If you terminate the transaction at this point because of the inspection you will receive your earnest money back.
One key phrase to remember is, "if you ask for everything, you may get nothing". Be careful to choose exactly what you would like the sellers to perform on the inspection report. If you ask for too much and seem unreasonable you may not get anything you ask for. Find some of the issues that are a major drawback to the purchase of the home such as hazardous items or expensive repairs and replacements. Small items such as light switch covers, handle replacements or paint scratches are all very simple items that can be fixed. Think about how much you love the home and what you're willing to give up in order to get the property. On the other end of that spectrum, sellers are deciding how much they're willing to do in order to sell the property. This is where buyers and sellers need to work together and negotiate a reasonable settlement for the inspection repairs.
Once the inspection report has been filed and satisfied the transaction moves on to "pending".
Final Walk-Through and Communication
At some point during this quiet time you will receive a call from your agent for the final walk-through. During the final walk-through, which will usually happen several days before the final signing, take a thorough walk-through the home double checking that there is no garbage left behind, the house is in a reasonable condition as when you first saw it, any repairs that were required on the home inspection report have been completed, and you are satisfied with the results. If anything needs to change at this point it needs to be documented in writing and sent to the seller. The seller can either correct the changes or mistakes or leave it as is in which case the buyer will either need to accept or terminate the transaction if the negotiations cannot be resolved. This is where you need to be very thorough; look through every drawer, cupboard, pantry and closet, turn on every light and check every appliance to make sure they work. Remember, you can't go back to the seller once you've signed the final documents unless there has been some sort of fraud involved.
If you are satisfied with the final walk-through the transaction moves on to closing final documents are collected for signing.
Depending on the terms set forth in the original purchase and sale agreement closing may happen at signing or several days after. Sellers may need to move once the home has closed so it not uncommon to give the seller three days after closing in order to move their personal items out of the home. If the home is vacant you may be able to get the keys and close the same day you sign. All of these details will be set forth in the original purchase and sale contract.
The sellers will be called in first to sign all of the documents in order to pass the real estate property from one person to another. The closing is usually held at the title or escrow company's office but may be held at a real estate office or any other agreed-upon location depending on the circumstances. The sellers will sign first and after they have left, the buyers will sign. You will need to provide evidence of your homeowners insurance and any inspections or additional addendum that may need to be satisfied at closing if applicable. You will need to bring along your certified or cashiers check to cover the down payment, closing costs and any other fees that were originally set forth in your HUD-1 document.
Try not to get frustrated with the amount of documents you will need to sign. Some documents may even seem foolish or silly such as signing a document stating that you signed the previous document. But all of these documents are to protect you and the seller as well as the lender and escrow agents involved. Every document is required either by law or the real estate transaction in general.
Once you've handed over any fees that are necessary, signed all of the documents and monies are dispersed to the seller and the buyer if applicable, all documents will be recorded with the county in which the property is located. The escrow agency will do this for you and then call your buyer’s agent to let them know the deed has been recorded. It is only at this time that you are allowed to receive the keys to your brand-new home! It is illegal for buyer’s agents or listing agent to hand over keys to the property before this closing it's recorded.
Ready to get started? Visit my website for more information or for tips on buying, searching for property or answers to your home buying questions. - VisionRealty.com