Under Contract: Now What?
You are a step closer to owning your own home
Want to make it smoother? Deluxive Homes recommend that you follow these guidelines along with your professional Realtors’ advice to simplify the contract-to-close and settlement stages.
Before you settle in, your lender will ask for a down payment. Keep in mind that, depending on your mortgage, the down payment can be as little as possible.
However, if you want to clear it within the shortest time possible or want to make smaller monthly installments, we recommend you put down more!
When purchasing your home, it is cardinal to contract a settlement company. It acts as an escrow. As an independent third party, it holds your deposit and coordinates activities between you and the seller. You can also contact an attorney to hold the deposit check or deposit it in your broker’s trust account. To avoid a daunting experience during this period of purchasing, make sure you have sufficient funds in your account.
If the sale goes through, the deposit check will be cashed to the seller’s account.
However, if it doesn’t go through, the settlement company (or attorney or broker) will deposit back to your account less the cancellation fees. In some cases, the seller is entitled to receive the deposit check to cater for liquidated damages. Make sure you consult with your counsel regarding whether or not you were responsible for the liquidated damages.
1. “Under Contract” period is 30 days
Depending on the agreement between you and the seller, this period can be longer or shorter. During the “under contract” period, all the specified items must be fulfilled. You and the seller must agree on the contingencies and the closing date. Some of the basic contingencies include:
It must be completed before purchasing. If the inspection leads to unsatisfactory results, you may want to cancel the contract.
This contingency gives you time to secure funding. If this process is fruitless during the contract, you can decide to remove it and get a loan or cancel the contract.
2. The seller must provide a marketable title
You, along with a title officer or attorney, should review the title report. Ensure it is clear with no legal ownership issues. In addition, ensure you and the seller have strictly complied with the state or federal property transfer policies and guidelines.
3. Get a homeowner’s insurance cover
Insuring your home against losses resulting from earthquakes, fire or theft is cardinal. The process of getting insured is lengthy. It is better if you start as soon as you purchase the home.
4. Contact utility companies to reconnect your home
- Upon purchasing the home, schedule to reconnect it to utilities such as water and sewerage, internet, and the main grid.
5. Schedule a final
inspection
Conduct a walk-through inspection as soon as possible to ascertain if it matches what the contract says.
Congratulations!
You are now a homeowner!
Congratulations on your new home!