Thank you for considering me to help you with your home purchase. Here is a step-by-step explanation of the process. This is a generic situation, and your situation will likely dictate some deviation from the norm.
- Search Plan. By computer and through our network of agents and brokers, we search all homes available on the Multiple Listing Service (MLS), using your search criteria (city, beds, bath, size, etc.). We focus the search and your criteria with you and discard all homes that do not meet those criteria.
- Appointments. We schedule appointments to enter and see the homes that meet your criteria.
- Loan Preapproval. Before we look at homes, you make yourself a serious buyer in any seller’s eyes by getting a loan preapproval letter from your lender. If you are not yet working with a lender, Lisa is a mortgage broker and can get you preapproved with minimal effort. She can be contacted at Lisa@Delzompohomes.com or (951) 704-4559.
- Search and Find. With you, we keep the appointments to see all of the homes that met your focused search criteria. You find “the” home, and we assemble the offer. You set the terms of the offer based on your loan amount, cash and closing costs you will put down, timing (fast or longer escrow), etc., with an eye toward meeting the seller’s goals as well. You sign the offer, and we submit it to the seller.
- The Deal. The seller may accept or reject the offer, or make a counter offer. We will discuss counter offers with you and, after your consultation with anyone you wish--your attorney, financial consultant, etc.-- you will decide on what final deal points you agree to with the seller such as price, terms, length of escrow, services, etc. as described in the contract you and the sellers will sign.
- The Escrow. When we have a signed contract, all funds, documents and instructions relating to your transaction will be delivered to a neutral third party—the “escrow holder” designated in the contract. The act of delivering these things to the escrow holder constitutes and opens the “escrow.”
Through Escrow. The contract contains certain items that must happen for the escrow to close successfully, transferring title to you and monies from the sale to the seller. Those items include, for example:
- Disclosures. The seller signs disclosures of their knowledge of aspects of the property to you in a series of documents, and you sign those documents acknowledging receipt of that information.
- Property inspections. You are advised to have professional inspections. After those inspections, you and the seller deal with the results, agreeing on whether to fix them or to provide that certain monies will be applied from the sale proceeds to correct those items.
- Title reports. As the buyer, you will want clear title to the property. During escrow, you receive a preliminary title report, which shows the seller as the owner of the property as well as money claims and third-party restrictions and interests that limit the use of the property. You as the buyer can reasonably disapprove certain claims or restrictions on the title (like debts secured by liens or judgments). Note: this report is not title insurance.
- Loan procurement. You must qualify for and obtain funding.
- Insurance. Your lender will require proof that you have obtained insurance for the property.
- Resolving Conflicts in Escrow. We hope your escrow will go smoothly from start to close. If, however, the escrow officer gets conflicting instructions from you and the seller or lender, the escrow will stall until the conflict is resolved. For example, the seller may dispute whether an item of personal property is included in the purchase price, or whether to do a repair prior to or after close of escrow. One saying that seems to help in these situations is, “RTC—Read the Contract.”
- Know The Escrow Officer. Please feel free to get to know your escrow officer and put a “face” or even your human voice by phone on your transaction. Call or visit the escrow officer; offer to give any additional information to make the escrow go smoothly.
To avoid bad surprises, pay particular attention to these areas:
- Closing costs. We will provide you a buyer’s net sheet that estimates costs for you. For further detail, when escrow is open, ask the escrow officer to prepare a statement of your estimated closing costs. You can fine-tune those numbers over the days and weeks as actual costs for inspections, repair/work credits, insurance, tax proration, etc., are received.
- Monies. When you put monies into escrow, do so by cashier’s check or have your funds wired directly to the escrow to avoid delays.
- Final Walk-through. We will have a final walk-through of the property several days before the scheduled close of escrow. You as the buyer can have the escrow holder stop the escrow if new/significant problems have arisen.
- Final Signing. Before closing escrow you will sign the documents purchasing the home. Check the estimated closing statement carefully for correctness/mistakes. Escrow holders are human, and they use numbers provided to them by other humans.
- Closing Statement. When your escrow closes, you will receive a final closing statement recording all the money related to the sale of your home, credits (money you put into the escrow) and debits (funds paid out of the escrow on your behalf for fees, corrective work, etc.). Keep that statement for tax time.
- The Keys. You get the keys to your new home at the time agreed on in the contract!
I hope this provides you a guide and some comfort, reducing the stress and worry by making the steps known and clear to you. This is merely an overview. Please be sure to consult your legal, financial and other experts as necessary for your situation. Please contact me any time with your concerns and questions, and I will help you resolve them as quickly as possible. I will stay in regular contact with you.