8 Next Steps After You Go Under Contract on a Home.
Once a seller accepts your offer, what happens next? This is a common question from buyers after they go under contract on a home.
After a buyer's offer is accepted you'll want to visit the home numerous times before closing day. This includes meeting there with your Real Estate Agent, Inspectors, Contractors, and more. You'll also want to make sure you schedule a final walk-through which your Realtor will set up.
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Without further ado, here is...
8 Things that Come Once an Offer is Accepted
#1 Call Your Real Estate Team
The seller just accepted your offer and you're officially under contract. So what's the next thing you do? There's probably an urge to post something on Facebook or another social media platform. STOP! Do not do that just yet because there are many things that can go wrong in a Real Estate transaction. If you start posting on social media you put added pressure on yourself to close the deal. Our recommendation is to tell your immediate family and some close friends, just be careful about sharing it with the world.
Your Real Estate team is now in full force, there are so many back end things going on that a Good Real Estate Team in crucial to getting you to settlement on time and with the least amount of headaches. Your Real Estate Agent will be able to walk you through the process of who you need to contact. Set the dates and times with your team (including settlement and Inspection dates). There are a lot of people on your home buying team you should be prepared to lean on in this time on understanding the home buying process.
Depending on what part of the state you're buying a home in your Real Estate team is likely to include different players. When you buy a home your team is likely to include:
Realtor, Lender, Home Inspectors, Insurance Agents, and in some cases Contractors.
There is a lot more to your Real Estate team that happens behind the scene, these are people you’re likely to never see and probably won’t ever hear from.
Once the Lender, Inspector, and Insurance Agent are aware of the fact you’re under contract they can begin putting together everything you need. You may want to connect with Contractors if you’re looking for some estimates. This will give you an idea of what the cost is to do things like add hardwood floors, or another bathroom.
#2 Earnest Money to Real Estate Agent ASAP
If there is earnest money it will need to be given to your Realtor as soon as possible. You will have this in your contract and it needs to be delivered immediately. Failure to deliver the funds promptly may result in a breach of contract.
Your Real Estate team will include inspectors of all sorts, the captain of this team is your Home Inspector. You’ll have an opportunity to inspect for pests, and hazardous items as well inside the house (jump to inspections). Make sure your lender can get the home appraised in this time period (see appraisals)! You would hate to find out the home appraised significantly below sale price after your due diligence period is over.
Once the Financial Deadline period is over earnest money goes hard. The likelihood of closing is much greater once the Financial Deadline period is over and you’ve made your request for repairs (see repairs).
#3 Send your Lender Documents ASAP!
Your lender is going to need to clear you to close. In order to do this a lot needs to happen. There is a list of things they are going to need from you and you need to make every effort to send those documents to them as soon as possible. Once your offer is accepted, there is still a lot of work you need to take care of and it’s mostly with the financing portion.
Your lender will require items like W2’s and other identifiable tax-related information as they will need to verify your income. The list of items needs to be delivered to your lender as soon as possible or you will risk not being able to close on time. It’s a wise idea to connect both your Realtor and Lender early on so they can work together and help you. And remember, NO new lines of credit, your debt to income will change and in most cases this will Kill the deal and you may have to be forced to wait in most cases 6 months before you can buy a home again, i never herd of a seller waiting 6 months to sell their home when they are other buyers ready to buy now.
#4 Time for a Home Inspection
When you’re buying a home you’ll want to inspect the property for any and all things that could be wrong with it. Some of the main items you’ll want to be on the lookout for include issues with the: Foundation, Roof, HVAC, Plumbing, and Electrical. Make sure you have a home inspector you like and schedule the appointment as soon as possible to ensure they have time to properly inspect your home.
There are certain issues that arise on a home inspection often, and there are others you’ll want to make sure don’t appear! Make sure you set your expectation that the Home Inspector you hire will be able to find problems with the house.
You will want to strongly consider adding Radon, Meth, and even Mold and other special testing to your team before your due diligence period ends.
#5 Your Home Appraisal
Ensure your lender is going to have your home appraised during the financial deadline period otherwise you may find out it doesn’t appraise and forking over your earnest money. Once a seller accepts your offer they want the deal to go through just as much as you do, so they’re pretty open to extensions should you need to request a financial deadline extension for your appraisal.
Having your home appraised is part of what ensures the money the bank is giving you is enough so that they can recoup most of it should you stop paying your mortgage. A home appraisal is the bank’s way of figuring out if the amount of money they are lending to you is more or less than the value of your home, and that you are not over-paying for something.
A lot of Real Estate Agent’s will tell you that you can’t overpay for a home because the bank appraises it. There is some truth to this, though it’s safe to say it isn’t 100% accurate. You have options when the home doesn't appraise and a chance to negotiate a better price. Some have seen homes appraise for a lot less than they should, while also seeing homes appraise for more than their market value.
#6 Due Diligence / Repairs Request
Once you have the reports back from the Home Inspector you have the opportunity to negotiate repairs with the seller. Some sellers are more than willing to make repairs while others will deny your request.
Of all the deals that go under contract, this is where a lot of them can be lost. Buyers and Sellers need to understand each other’s position and whether or not it makes sense to continue with the sale based on the repair requests.
More often than not there will be a mutual resolution during these due diligence repair negotiations. Sometimes the seller will make the necessary repairs or provide the buyer with a financial concession at settlement so that they can make them with their own contractors.
In most cases when a home in purchased there are several problems that may need to be addressed before it made sense to buy the home and if the seller agrees, It's a mutual agreement between the seller and buyer to replace, for example, the HVAC as well as a few other items before continuing with the sale.
Both parties were happy and that’s what matters most in a real estate deal.
Remember in any request to fix items, both parties involved have 3 choices:
#1 Seller can fix all items requested.
#2 Seller can fix some of the items requested.
#3 Seller can fix none of the items requested.
This in return gives you the Buyer 3 choices as well:
#1 Accept that the sellers will be making the repairs with their own contractors.
#2 Accept that not all repairs requested will be fixed and fix the rest yourself.
#3 Accept none of the repairs will be fixed, or walk away and find another home.
#7 Turn Utilities on in the Home
One of the last things you’ll do a handful of days before you move in is set up your utilities. You can contact the listing agent to see who the seller’s current providers are so that you can either remain with them or switch to someone you like.
You’ll want to turn on things like electricity, gas, water, cable, internet, phone, etc. That way when you move into your new home you’re ready to go. The final step is moving in, you may want to hire a moving company to help you move all of your stuff. There are many problems that can occur with moving companies so be sure to avoid all of them that you can!
#8 Close & Move Into your New Home!
Congratulations, this is the fun part! It’s time to move into your new home and you can finally relax after unpacking. It took an army, a national survey concluded that an average of 37 different people will have touched this transaction to made it happen and you should be proud. You’re probably exhausted after the home buying process. It can definitely take a lot of work, and it’s all worth it!
Some of the final items you’ll need to take care of is an address change. You’ll want to be sure all of your mail is now coming to your new address.
It’s also a great opportunity to meet your new neighbors! When you see them outside don’t be afraid to wave, and follow that up by walking over and introducing yourself. Most people form great relationships with their neighbor’s right off the bat. It’s an awesome opportunity to meet others in the neighborhood as well through your direct neighbors!
Things to Think About After You've Moving In:
Aside from the obvious decorating and furnishing your new house, you'll want to be sure you let everyone know you have changed your address. You can do so on the United States Postal Service website here. This will forward your mail to your new location. You'll want to let work know as well as the bank that you've changed your address.
If you're going to plan a housewarming party you may want to give yourself a few weeks to really settle in first. It can take that long to really 'move-in' to a new place. There will always be little things to do the first few weeks after moving in whether that's mounting the TV to the wall or placing pictures around the house.
Also, don't forget to set aside time to update the debt in your life, now is one of the best times to update your records with Credit Card companies, Banks, Auto Loans, Subscriptions and any Revolving Credit and while your at it, this is a perfect time to update your passwords.