What Happens After Your Real Estate Offer Is Accepted
Congratulations! You’ve found a home that you love and negotiated an acceptable price and terms to make it your own. What happens next?
Well, a lot of things will happen very quickly, which is why finding the right agent to guide you through the sale process is critical. The following is a basic overview of the steps to get you to a successful closing.
Once your offer has been accepted, you will need to immediately pay the agreed upon deposit to the listing company. Many sellers are now requiring that these funds be in the form of a cashier’s check or money order. These funds are held in an escrow account until the closing, where they are credited back to you, reducing the amount of cash you will need to bring to the act of sale.
If you have not already made a formal loan application (and I sincerely hope that you have!) the Louisiana purchase agreement states a time frame for doing so, typically within 3 days. It is critical to get all of the information requested by your mortgage professional as soon as possible, along with a copy of the signed purchase agreement.
As a purchaser, you have the right, at your own expense, to perform any and all inspections that you want on a property you are purchasing. This right, in my opinion, should never be waived. I would much rather see a buyer lose a few hundred dollars on inspections than to purchase a home with defects that could cost them thousands in the future. Note, however, that inspections are a tool for uncovering defects within the property. This should not be used as an opportunity to “beat up” the seller over worn flooring or other cosmetic items that were obvious and visible when you made your offer!
Customs, laws and requirements vary from state to state across the country, but in the New Orleans area the customary inspections are:
- Full home inspection
- Termite inspection
- Plumbing inspection
- Structural inspection
Once the inspections are completed, an inspection response and a copy of the inspection report are provided to the seller. This response allows you to outline any defects with the property that you would like to have repaired and how the repairs are to be completed. For example, if the air conditioning system is functional but dirty, a request can be made to have the unit cleaned and serviced by a licensed A/C contractor. It is important to be specific in how defects are to be corrected! Some items can be solved by the homeowner or handyman, but others may require a licensed professional such as a plumber or electrician.
The seller has a few different options in how they can respond to a request for repairs. They can refuse to do any repairs, they can agree to do all of the requested repairs, they can offer to renegotiate the price based on needed repairs or a combination of these options. Once any needed repairs have been negotiated, we move on the next step in the process.
ALSO READ: Negotiating Home Repairs After an Inspection
This is the hurry up and wait portion of the buying process! You must hurry to get all of the required information to your mortgage company in order for them to underwrite your loan and then wait for that process to be complete. Oftentimes, they will request additional information or documents to finish this process. Don’t panic or get frustrated! This is completely normal and customary.
The mortgage company is also responsible for ordering the appraisal of the property. Just as you don’t want to pay more than a house is worth, the bank or mortgage lender does not want to lend you more than a house is worth. A licensed appraiser will inspect the property and prepare an appraisal of the value based on the details of the home you are purchasing and comparable properties that have sold in the area. Remember, you are paying for this appraisal…be sure to get a copy of it from your lender for your records.
Once your offer is accepted, I urge you to start shopping for homeowners and flood insurance right away, since you cannot close on your new home without a paid insurance policy. Individual insurance companies charge different fees and it is worth the time it takes to compare policies and prices between at least three different companies. Active military families have the option of applying for insurance through USAA which offers reduced rates for active duty military personnel.
The title company is responsible for researching the ownership history of the property to ensure that you are getting clear title. They coordinate with the listing agent, selling agent, mortgage company, buyer and seller to prepare all of the required closing documents and perform the actual Act of Sale. Once a contract has been sent to the title company, they will contact both the buyer and seller to obtain their personal information such as full legal name, social security number and marital status and begin the process of preparing for and scheduling your Act of Sale. At the Act of Sale you will sign all of the mortgage documents and receive the keys to your new home!
While this is a broad overview of the purchase process, every transaction is different. There may be additional or different terms in your purchase agreement. Again, this is where a professional REALTOR® is your ally!