Contract to Close

Contract to Close A seamless guide for buying, closing, and owning your new home.

Cummings & Co. Realtors | www.cummingsrealtors.com

STEP ONE:

STEP FOUR:

Accept Contract

Home Inspection

When the seller has accepted your offer, the home is now “under contract”. While there are many steps from now until closing — congratulations on having your offer accepted! The sale is now “contingent”, which can mean many things depending on the details of the agreement between the buyer and seller. There could be contingencies such as:

With your contract accepted and your mortgage application process underway, speak with your real estate agent about scheduling a home inspection. If an inspection contingency is present, it’s important to get this scheduled and completed as quickly as possible so that the buyer can make informed decisions on the direction of their contract in the event that renegotiation is necessary. Inspections are a vital part of the homebuying process, as they will allow the buyer to more fully understand the details of the property they are looking to purchase. Ensure that you use a trusted, licensed professional for this process, as their input will be valuable when making such a large, life-changing financial decision.

• financing contingency: in which the buyer must procure adequate funding for the purchase, • appraisal contingency: in which the lender must determine whether the purchase price is an appropriate value • inspection contingency: in which the buyer or seller may renegotiate following the details of an inspection report • home sale contingency: in which the purchase is dependent on the buyer closing on their own home.

Any contingencies described in the contract will need to be met prior to closing. Your lender, title company, or real estate agent can all assist with understanding more about the intricacies of these processes, and are always here to help.

STEP TWO:

Mortgage Application When purchasing your home with a mortgage lender, is imperative to fully complete your mortgage application. This process may take time, so it is important that the buyer begins quickly following the acceptance of their contract. Use your lender as a resource throughout this process, as completing it correctly is vital to ensuring your financing is secured.

STEP THREE

Order Title Search An important step is to ensure that you work closely with your selected title company to order a title search.

The title search is vital to ensure that the property seller is legally able to sell the property, and has possession of the property or is in good standing with the bank.

STEP FIVE:

Homeowner’s Insurance Within one week of your contract being accepted, it is recommended that you seek and secure a quote for your homeowner’s insurance. If you are an existing homeowner, you may try calling your current homeowner’s insurance provider as they may offer competitive rates for your move. This is also an excellent time to shop around for new options, and having multiple quotes and options is always helpful.

Once you’ve selected a provider, you’ll need to pass the information to your lender, as the lender will need to determine how much of your premium must be paid at the time of closing.

STEP SIX:

Loan Documents Your lender may send your pre-closing documents to review and sign during this process. These will include most of your financial figures, and are the precursor to the closing disclosure you will receive no later than three days before closing.

STEP SEVEN:

STEP NINE:

Appraisal Scheduled

Closing Preparation

Following the completion of the home inspection, most lenders will require a home appraisal. This helps the lender to accurately determine the current market value of the home based on any number of comparative points. The appraiser is expected to be unbiased and objective when determining a home’s value, and the final report is generally expected within one to two weeks of the scheduled appraisal.

In some cases, an appraisal may come in lower than the purchase price. There are a number of options for both buyers and sellers at this point that may include: • renegotiating the contract terms with the seller • walking away from the deal if an appraisal contingency is present • offering a larger down payment to cover the difference in appraised value and loaned amount.

In any case, your lender, title company, or real estate agent are available to assist with understanding the results of your appraisal and what it may mean for your purchase.

As you prepare for closing, your lender or agent will review your settlement statement to prepare for closing. You will have an outline of all funds required for settlement, which will need to be wired to the title company 24 hours prior to closing to ensure that the process continues without delay.

STEP TEN:

Set Up Utilities A few days before closing, it’s important for the buyer to ensure that utilities have been turned on. Your real estate agent can assist with confirming the utility providers that are currently servicing the property.

Utilities such as gas, electricity, cable, phone, and internet are all items the buyer will want to have set up prior to move-in date. Your water bill will automatically transfer into your name as part of the property being transferred into your name.

S T E P E I G H T:

STEP ELEVEN:

Final Walkthrough

Attend Closing

Very near to your closing date, it is recommended to take your final walkthrough. This is the buyer’s opportunity to ensure that any details that had been outlined in your contract or negotiations have all been completed. This may include things such as removals, repairs, or simply just ensuring that the property has been vacated prior to closing.

The home stretch! It’s time to attend your closing. You are nearly finished with purchasing your new home.

The closing process generally takes about an hour and will require document signing from both parties. Once everything has been signed and all money has been transferred and received, you will get the keys to your new home!

Congratulations!

It’s time! Get ready to move into your new home. Take an opportunity to get organized for your move, whether this means hiring movers, planning your furniture layout, or ordering new household items. Get ready to enjoy all that your new home has to offer.

C O N T R ACT TO C LO S E T I M E L I N E

Accept Contact

Mortgage Application

Order Title Search

Home Inspection

Final Walkthrough

Appraisal Scheduled

Loan Documents

Homeowner’s Insurance

Closing Preparation

Set Up Utilities

Attend Closing

Move In!

With more than 150 combined years of experience, Cummings & Co’s in-house title company offers convenience without sacrificing on quality. We are confident that our professionals can help make your transaction flawless and stress-free. Although you are welcome to work with a title company of your choosing, we would love and appreciate the opportunity to earn your business with our in-house team!

Please call us with any questions or for a quote: 410-457-9910