Selling your home is an exciting accomplishment! Today we are going to walk you through exactly what happens after you accept an offer.
Step one in the escrow process is officially accepting an offer. When you do this, escrow is officially open. Right below are all the important contacts in the transaction, including Rosie Hicks, our closing coordinator, who will be your primary contact as we go through this period. She is responsible for dotting the I's crossing the T's, and making sure all disclosures are completed so we cover all of your liability in this transaction. Also, there will be contact info for the escrow company, the middle man in this transaction. They will be collecting all the documents and funds to make sure the deal gets closed. Thirdly, we have the title company. Their job is to make sure the property has a clean title and address any issues so we have a nice, smooth escrow process.
Step two in the escrow process is when the buyer gets the ball rolling. They need to send in their initial deposit to the escrow company. It's due within three days of offer acceptance. If that business day falls on a weekend, it rolls over to the following Monday. We will make sure they get their deposit in escrow within those three days. If they don't, we will give them a notice to perform, which means they have 48 hours to get that deposit in. If they don't, you have the right to cancel the transaction and move on to another buyer. Rest assured, we are on top of it and will let you know the second that deposit goes into escrow.
Time for step three, signing all of your disclosures. Rosie will be reaching out to you to provide you with all the disclosures you need to sign to make sure you are covering your bases and covering your back in this transaction. When filling out the disclosures, a lot of sellers will ask, "Do I need to disclose this?" The answer is yes. You need to disclose any and everything relating to that home. We’ve found its best to be very general when providing a description. If there is a crack in the driveway, just say it's a crack, not a big or small one. Over-disclose, don’t under-disclose. There's nothing worse than getting your transaction closed and having something come back and bite you in the butt. Make sure to over-disclose, let the buyer know everything that's out there and if you have any questions, please give us a call.
Step four in the escrow process is when the buyer will have their home inspection completed. A typical contract allows 17 days for the buyer to get this done. When the inspection is completed, it's customary for the seller not to be home. There will be a neutral third party that will come out to the home along with the agent and the buyer. They will do a complete walk-through of the home, paying special attention to the systems of the home including plumbing, roofing, electrical, and foundation. Most homes are going to have some issues, whether it's brand new or 100 years old. You can sell your home as-is, but it is customary a lot of times for sellers to take care of some of the major issues relating to safety or health. It's 100% negotiable, and that's going to come later in the process. When that inspector is at your home, you are looking at anywhere from 2-4 hours for that inspection to be completed. You want to make sure you are not home during that inspection, and as soon as we get any word back regarding any potential issues, you will be the first to know.
Time for step five in the escrow process, getting the appraisal completed. The buyer pays for this so you don't have to. The buyer will have an appraiser come out to the home and do a complete walkthrough. They will be in the home for around 30-60 minutes, and then they will put a report together and send that back to the bank. The bank will look at the appraisal and make sure the appraisal comes in at least what we are in escrow at. If the appraisal comes in low, it will open up another round of renegotiations, which we will discuss in step six of the process.
Next is the renegotiation. If there are any issues that come up in the inspection, this is where the buyer will address them. They will send us a request for repairs, requesting the issues the want to have handled. In a perfect world, the agent lets the clients know that no home is perfect and only to ask for repairs on crucial things like plumbing, electrical, health, and safety issues. There are some agents that will want us to fix everything found on the inspection. You have no obligation to fix anything on that list, but it's customary to agree to fix some of the major issues that do pop up. If there were any issue with the appraisal coming in low, this is where that would be handled as well. We will let you know if there is a request for repair or an appraisal issue, so stay tuned.
This is where it starts getting fun. Step seven of the escrow process, this is where it starts getting fun. This is the removal of contingencies. At this point, the inspection is done, the appraisal is done, and they are ready to move forward. We will request the buyer to remove all contingencies on the home. By signing that contingency removal form, they are declaring that they are moving forward, and their deposit becomes non-refundable. That means once they sign the contingency removal, if they back out of the transaction at any point, you will keep that deposit. The good news is that most buyers won't walk away from that deposit. They will get deals closed and get you paid!
It's time for step eight. This is when the buyer has signed all their loan documents. Now that they are signed, escrow will send all those loan documents over to the lender, making sure they can review everything and we can move towards funding their loan.
What's happens now, in step nine, is that the buyer's loan has funded and they have sent all their closing funds into escrow. Now that all the funds are there, escrow is going to send someone down to the county recorder's office with a copy of the grant deed, and they will get the county recorder's stamp on that. Once the stamp is there, they will give us the call and give us the word that we are officially recorded, which means you are closed and getting paid. We should be closed within 1 business day.
Step ten in the escrow process, we are officially closed. Thank you so much for giving us the opportunity to work with you in the sale of your home. We sincerely appreciate it. If you know anyone else who is looking to make a move, we would love the opportunity to meet with them and see what we can do to help them accomplish their goals. Now that we are closed, escrow will send you a final closing statement, and you will receive your funds. They will have all of that out to you within one day of closing. Enjoy that money, and we will talk to you soon!
