The Home Buying Process – What to Expect

Real estate purchase contract on a table.
THE HOME BUYING PROCESS – WHAT TO EXPECT

Ideally, the process goes like this:

  • Your agent will present a written offer to the seller. A mortgage approval letter and a 1% deposit check should be attached.  Now is the time to identify your attorney.
  • The seller either counters or accepts the offer. Now is the time to choose the home inspector.
  • Buyer and seller agree on price, closing date, inspection date, contract signing date and mortgage contingency terms.
  • The executed offer is sent to both attorneys. The seller’s attorney writes the purchase contract.
  • The inspection date is typically within 5 days of the accepted offer.
  • The contract signing date is typically scheduled about 10 days from the date the offer is accepted.
  • The mortgage company will order an appraisal if there is a mortgage contingency.
  • If there are problems uncovered by the inspection, they are sent to the seller to be addressed.
  • Once the buyer and seller agree to the resolution of the inspection issues, the contracts are finalized and executed by both parties. The buyer now makes a full (non-refundable) deposit, usually 10% of the purchase price.
  • If the sale is contingent upon a mortgage, it could take about 30 days for the approval.
  • Once the mortgage is approved by the bank, the deal is secure and the closing can go forward.
  • Closing is typically around 2 weeks or less after the bank approves the mortgage.
  • The buyer will do a final ‘walk-through’ before the closing to insure the home is in the same condition as it was during the inspection.
  • The entire process typically takes about 60 days. With no mortgage contingency, it can be much less.

Some common exceptions:

  • The inspection uncovers many issues and the price needs to be renegotiated. This can cause delays until the parties agree, or it could end the deal altogether.
  • Buyer or seller call off the deal before the contracts are signed. The 1% deposit is returned.
  • The appraisal comes in lower than the agreed upon purchase price. The sale price may need to be renegotiated.
  • The mortgage process takes longer than expected, extending the planned closing date.
  • The mortgage is not approved and the deal is off.  The buyer deposit is returned.