Congratulations!
You've had your offer accepted to purchase a home. Now that you have found your new home, the first major step of the home buying process is under way. Now the real work begins.
We've got deadlines, paperwork and tasks to complete. But don't worry -- our team is prepared to be your guide each step along the way. Please note each of the items below have contractually obligated due dates attached to each step.
This site is designed to help ensure your home purchase is:
1. In compliance with the terms of your purchase agreement at all times
2. A reference tool and guide you can reference any time throughout the process
3. Maximizing your time, dollars, and investment
4. A place to provide piece-of-mind as we work through this often complex process together
Of course, we're always just a phone, text or email away if you'd like to confer with us personally as well.
Contingency 1: Attorney Approval
Your purchase contract is contingent upon a review of the contract and disclosures by both real estate attorneys. Your attorney and the Seller's attorney will have 3 business days from the receipt of the contract to review and release that contingency.
Your attorney's office will call to review the contract with you and make sure you understand each aspect and to discuss any questions you may have. If there are any concerns or changes to be made, this is the time to do it. Your attorney will then issue an approval letter (conditional or non-conditional) to all parties releasing this contingency. During this time, you can also back out of the contract at no cost or penalty to you by having your attorney decline the contract.
If no approval letter is issued within 3 business days, the contract is automatically approved. Inspection or additional contingency periods begin at the expiration or satisfaction of this contingency. (For example, if both attorneys issue their approval on the first day, then this first contingency is considered satisfied and your home inspection period starts the following day.)
This contingency period lasts up to 3 business days from attorney's receipt of contract
PRO TIP!
- Either party can cancel the contract for any reason during this period. Be cautious in the scheduling of your inspection if you have this option in your purchase contract. If the seller receives amore desirable offer during this time, they do have the ability to accept that other offer and cancel yours.
The home inspection contingency period is dictated by the time written into your contract. Most inspection periods run between 3-7 calendar days starting at the release of the attorney approval contingency.
Contingency 2: Home Inspection
In today's market, you may have decided to waive your inspection and this contingency does not apply. If this is the case, please move onto the next step.
If you are able to conduct a home inspection as part of your contract, you may use whomever you'd like. However, while your uncle may be incredibly knowledgable, he is not insured to inspect the mechanicals, open the electric panel, or even open a window. Additionally, our ability to negotiate on your behalf post inspection is aided by the report of a respected & qualified inspector. All paid inspectors will be licensed by New York State and must also carry insurance. (If you need an inspector, please refer to our RESOURCES page for our list of recommended professionals).
An important note is that this contingency does have an expiration date! Please be sure to book your inspection with enough time to conduct the inspection, receive and review the inspectors report so that we can respond to the Seller by the timeline dictated by the contract. (Please note: Radon tests need to be placed within the home for 48 hours).
If you've never owned a home or don't know much about caring for a new property, the inspection process can feel overwhelming. Your home inspector may spend up to 3 hours in the home and will often provide a list of items suggested for repair or replacement. The best approach is to remember that the inspector is there to provide information for you to make an informed decision. Inspections do not pass or fail, but are designed to provide you with information so you can determine how you'd like to move forward. The resulting report is yours alone and aspects of this report are only shared with the Seller if you choose to do so.
It is important to understand that there is no perfect house. The goal of this process is to ensure there are no major safety concerns or “deal breaker” deficiencies and therefore, this step is not necessarily an opportunity to renegotiate the terms of the contract. It is a tool for you to understand how the house operates, how to plan for the future care of the home, and an opportunity to spend time discovering the property with a professional. Based on the findings and a discussion with your agent, you may choose to take certain requests back to the Seller. We will help you review, discuss and manage this response.
The inspection is often the last time you’ll be in the house until just before closing, so it is a good idea to take whatever pictures you may need, grab measurements, get contractor estimates or bring a cherished loved one along.
Your Escrow or Good Faith Deposit Check
You did it! Your major contingencies have been satisfied and you are now ready to move forward with your purchase.
Escrow or Good Faith funds are most often held in escrow with the listing brokerage and will be considered part of the funds you bring to closing. This is an excellent opportunity to make your offer stronger in the eyes of the seller, but doesn't cost you any more in the long run. (If your contract is contingent upon bank financing, you are protected from losing this deposit if you unable to obtain financing and therefore unable to move forward with the purchase.This deposit is most often made by personal check but a cashiers check or wiring of the funds are also an option. The check should be made payable to the listing broker for the amount on your contract (please refer to paragraph 4(B) of your contract for amount and timeline). Please work with your agent to determine if you can mail the check or will need to hand deliver it based upon your contractual timeline.
Please note: It is important to make a copy of the front and back of the check prior to drop off. Your lender will need this later.
These funds are due to be received by the listing brokerage within 48 hours of the satisfaction or release of the above contingencies
Applying For Your Mortgage
If your home purchase is based upon obtaining financing, now is the time to get that ball rolling. It will be your responsibility to contact your mortgage rep and complete the mortgage application within 5 business days of the release of your contingencies (unless another timeframe is stated in the contract). Please contact your chosen loan representative to complete this step as soon as possible.
Now is the time to decide whether to "lock" or "float" your interest rate. Discuss your options with your lender.
They will likely need the following and more:
Last 2 years tax returns
Last 3 months bank statements
Statements from all applicable investment accounts
Copy of the contract of sale + any addendums related to your financing (we can send these)
Copy of the deposit check (front & back)
Funds for appraisal: ~$500-600
This step must be completed within 5 days of the satisfaction or waiver of your contractual contingencies
The Appraisal Process
Your lender will require a third-party appraiser to do an in-home valuation of the property. The appraiser's primary focus is to validate the value of this property in relation to similar homes that have sold nearby within the past 6-12 months.
Based upon the type of financing you are using, they may also be required to ensure the house meets the guidelines of that program. For example, FHA, SONYMA & VA loans insist upon specific requirements for the condition of the property that differ from a traditional conventional loan.
Appraisal results can take up to 7-10 days from the date of the in-home inspection and your lender will likely provide you with notice if the results met the contract price and if any repairs are required. If this value comes in underneath the purchase value, or if certain repairs are required, we will discuss your options but in many cases you are not required to move forward until a new agreement is reached with the Seller.
Most often occurs approximately 2 weeks following loan application
Obtaining A Mortgage Commitment
Based on your purchase contract, your lender must issue this mortgage commitment letter by the due date in the contract, if not before. The date in the contract is a “drop dead” date. If the terms are not met, the Seller does have the right to cancel the contract.
The best way to ensure this due date is a reality is applying for your mortgage in a timely fashion and quickly providing your lender with all the items they request. It is a good idea to stay in close communication with your loan originator and loan processor to ensure everything is on track.
Once your commitment is issued, please review your commitment letter carefully. It will outline the terms of your mortgage agreement and give you a better understanding of your closing costs. It will likely also have a number of additional conditions that must be met in order for the bank to clear the loan for closing. The sooner you are able to satisfy those conditions, the sooner you will be cleared to close. At this time, we will share the commitment with both attorneys in order to satisfy that contractual requirement.
Commitment letters are usually due 30-45 days after the "effective date" in your contract. (Refer to paragraph 10(B)(3) for your required timing).
Almost there!
You've been "Cleared to Close" by your lender and your attorney, the Seller's attorney, and the bank attorney have set your closing date.
You've done all the work needed to get to this step and it often wasn't easy. So first off, congratulations to you. You're very close to owning your new home. As we prepare for closing and beyond, there are just a few more steps to take.
Your Closing Date
The closing date on your purchase contract is a target date meant to give each involved party a date to aim for. Unfortunately, the target date in the contract is not a firm date in New York State and is rarely the actual date of closing, so do not schedule movers or make any plans until your attorney informs you of a firm scheduled closing date.
Once your closing is scheduled, we will work with you to schedule your final walkthrough, check for any final transactional obligations, and prompt you to call to transfer the utilities to your name for the scheduled date of closing. The Seller will likely be calling to have the utilities turned off as of this date, so if no one steps up to say “put them in my name” they will turn them off and you will create extra work for yourself in getting them turned back on.
Refer to paragraph 14(A) of your purchase contract for the target closing but remember the actual closing is not set until all parties are ready
Please refer to our RESOURCES page on this site for local utility information.
The Final Walkthrough
The first step following the scheduling of your closing date is to make arrangements for a final walkthrough of the property prior to you taking possession of the property.
We schedule this inspection within a day or two of closing to provide everyone enough time to address any necessary issues, but close enough to the closing date to ensure as little as possible can happen before all responsibility for the home is yours.
The final walkthrough is not a full inspection and is conducted by you and your agent. This visit to the home is a quick review of the property to ensure:
the home is in the same condition as when you were last inside
there is no damage or changes beyond what was contractually agreed upon
the mechanicals are operating as they should (this includes running the furnace, AC, hot water, flushing toilets, etc as appropriate)
as much as possible based upon Sellers timing, that the property is cleaned out and ready for closing
The contract requires the property to be in “broom clean” condition. If the Sellers are ready to close, this means the property should be free of personal property, trash, and debris throughout. Sellers sometimes leave some unexpected personal property that may be of use to you and possibly some items maybe you didn’t want -- it may be best to weigh taking the good with the bad and what is able to be managed by you. This time in the home is often used to record meter readings for the utility companies (cell phone pics are fine).
In the event there are any issues with the property at the final inspection and adjustments need to be made for repairs, debris removal, or other requirements, we will negotiate with the listing agent on your behalf or if necessary, may run these issues through the attorneys. (If closing figured have to be adjusted, please note that your lender is required to wait an additional 5 days after issuing a new closing balance).
Most often conducted 24-48 hours prior to closing but may vary based upon your unique transactional or scheduling needs
Closing Day
You made it!
Your closing is likely to take place at your attorney's office but occasionally can be moved to the bank attorney's or other location. You will need to attend in person. (If this is not an option, please let us and your attorney know well in advance so alternative solutions can be discussed). Please confirm with your attorney for the date, time, and location.
You will need a legal form of identification and likely several checks. These will need to be bank certified cashier's checks or previously arranged wire transfers .
The signing will likely take about 30-45 minutes. During this time, your attorney will review any title curatives, easements, and other pertinent findings if they haven't already. You will leave with a stamped deed, and in most cases, a copy of the survey.
Your title will arrive in the mail a few months later. It is important not to lose this document! You will need it when you go to sell your property and it is costly to replicate.
The Home Is Yours
Congratulations! You are now a homeowner!
We will make arrangements to get you any remaining keys, alarm codes, garage door openers and more.
We always suggest your first course of action should be to have the locks changed -- you never know who the previous owners may have given keys to.
Time to move in and make it your own. We appreciate you choosing us to be a part of this important purchase. We hope you enjoyed this experience and will consider referring us to your friends, colleagues and family. If so, you can do so VIA THIS LINK.
Finally, you are now part of OUR bigger mosaic and we hope you'll continue to be in touch and let us know how you're enjoying the home. We're always available to answer any future real estate questions, discuss possible renovations, discuss updating values, or just to hear what's going on in your life.