Congratulations! You are now IN CONTRACT! Here's a Step-by-Step Guide of what happens next
Signing of Reviewed of Disclosures
Before making the offer, we reviewed the disclosures we have been provided thus far. Now it's time to sign them, acknowledging that you received and reviewed each disclosure item that the seller provided. My Transaction Coordinator Courtnee (more about Courtnee below) will send them to you via DocuSign.
Good Faith Deposit & Wire Instructions Best Practices
Usually within 1 business day after your offer is accepted, you must wire the good faith deposit into the escrow account at the title company. The best practice for wiring funds is summarized here.
1. Never wire funds to anybody or any institution unless you have checked the wire instructions independently with your title company, settlement or closing agent.
2. If you can’t or won’t confirm the information over the phone, most title companies, settlement companies and closing agents post their wire instructions online, so be sure you check their official websites. If they do, you can compare those instructions with the instructions you received.
3. Some agents will confirm the instructions you received over the phone if you give them the information you received. Just make sure you are talking to the right person at the right place. The system is far from perfect now, so you must be vigilant and when it comes to wire transfers and verify and reverify the information from trusted sources. If you receive an email, you need to make sure it’s from a trusted source. If you receive a text, you must make sure it’s from a trusted source. If you receive a call, you need to make sure it’s from a trusted source. In the end, you need to have a good working relationship with your settlement agent to make sure that you know that “trusted” source.
Don't Make Any Financial Changes During Escrow
Once you are in contract/in escrow, make sure to adhere to following no-nos:
no new credit cards
do not lease or return a leased vehicle
do not change jobs; do not quit your job
do not move bank accounts around
do not open or close any bank accounts
do not buy anything that needs to be financed
do not open any new consumer credit accounts
do not be late on any credit card payments
do not make large deposits into any accounts that you cannot explain or document to the lender
do no co-sign any loans for anyone
don't spend the savings that you budgeted for your down payment
don't forget to disclose all of your financial obligations including child or spousal support payments.
Rodney: My Transaction Coordinator
Once we are in contract, you will start to get email communications from my Transaction Coordinator Rodney. He will help us stay on track and meet all of our deadlines between the date your offer is accepted and the close of escrow. He will send you lots of things to sign via DocuSign along the way. He is here to help but if you have any questions, please let me know and I will get them answered for you.
If you are getting a loan to purchase your new home, and even if you do not have an appraisal contingency, your lender will order an appraisal on the property because it is the collateral for your mortgage. You are entitled to a copy if you have paid the cost of the appraisal to the lender.
Homeowner's or Hazard Insurance
Your lender will require that you have homeowner's insurance. I will provide you with a referral if you don't already have a relationship with an agent for renter's insurance or car insurance; sometimes you can get a loyalty discount from a current insurance provider. This will need to be in place before the close of escrow. Even if you are not getting a loan, I strongly advise you to have homeowner's insurance in place before the close of escrow.
Final Walkthrough of the Home
Once you are close to closing on the home and ideally after all seller items and any staging that was in the home have been removed, you are entitled to and should do a walkthrough of the home. The purpose of the walkthrough is to make sure the home is in the reasonably the same condition as when you first saw the home. I will accompany you on the final walkthrough and afterwards, we will complete a form called "Verification of Property Condition" and sign it and send that to the seller.
Closing Costs, Title Insurance and Transfer Taxes
Who Pays What in California and San Francisco.... Once that work is complete, they offer title insurance to the lender, to protect the bank from any undiscovered issues surrounding the title. Because the lender’s policy only covers the lender, your lender will require you to purchase the Homeowner’s Title Policy.
Signing Documents and Closing
Once you have removed all contingencies and finalized your loan, you are ready to close per the contract. You will receive an "estimated closing costs" statement that detail all the costs entailed with purchasing a home. Even though “Closing” or “Settlement” often refers to the actual day that the transaction is finalized, it’s actually a process that begins as soon as a purchase contract is signed. The title company will be conducting a final search on the property’s title. They will search through property records looking for potential problems that might prevent a smooth transfer of ownership, such as new liens, tax liabilities, and housing code variations. They may also physically inspect the property to verify the lot size and check for unrecorded easements.
Once your home purchase is "closed," you can now get the keys and you can prepare to move in.