Congratulations! Your offer has been accepted by the seller of your dream home! This is one of the most exciting parts of the home buying process, but you may be wondering what is supposed to happen next. Once your offer is accepted by the seller, a few steps will need to take place prior to closing. In this week’s blog, Michele Harmon Team has everything you need to know about what happens once your offer has been accepted on a home in Texas.
Contract Execution
Your contract is executed when all parties have signed the contract and a date has been filled in by the last party’s agent signing the contract. The day your contract is executed will be referred to as day zero. Day one begins the following day.
Earnest money and option fee checks must be delivered to the receiving parties within three days of the execution date. The earnest money is typically 1% of the purchase price. This check is written out to the Title Company and the money is deposited immediately into an Escrow account with the Title Company. Your earnest money will go towards closing costs when the transaction is completed. The option fee is written out to the title company and the amount goes towards closing costs. However, it is nonrefundable if the contract is terminated and the seller receives this amount. The contract is “receipted” when each check is received by the assigned party.
The Option Period
Your option period begins on day one. This is the time to get inspections completed and to opt out of the contract if necessary. This period is negotiable, but usually costs about $10-$50/day and it lasts about 7-10 days. The option period ends at 5:00 PM on the last day. Once the contract is executed, you should promptly schedule your home inspections. Home inspections are a buyer expense.
Repair Requests
Repair requests are typically made upon completion of a home inspection. Items that should be requested for repair are issues regarding health and safety and/or structural integrity. Any small items of repair are accepted ‘as is’ by the buyer.
Financing Approval
If you are securing a loan, the lender will order an appraisal on the property at your expense The property must appraise for the selling price with no lender required repairs. If you are unable to get approved within the negotiated amount of days (per Third Party Addendum), you can terminate the contract and the contract supports the earnest money being refunded.
Survey
The Title Company will order a survey if an acceptable survey has not been provided by the seller. The Title Company opens and clears the title on the house, making sure there are no outstanding liens or claims that could potentially compromise your ownership. The survey is most commonly a buyer expense because a buyer needs it in order to complete the purchase.
Closing
At least three banking business days prior to closing, your lender will provide you with a Closing Disclosure, detailing all of the financial terms of your transaction and the final figures you will bring to closing. It is critical that you acknowledge this disclosure in a timely manner so your closing date is not compromised. Any questions regarding the figures or execution should be directed to your lender and/or title company.
You and your agent will schedule a final walk-through of the house before closing. This is to ensure the home is in the agreed upon condition per contract details. When closing day arrives, we will meet at the title company unless other arrangements have been made. All signers, including non-borrowing spouses, will need to provide a valid government-issued photo ID, and funds to close should be provided in the form of a Cashier’s Check payable to the title company, unless arrangements for wired funds have been made in advance. Click here for more details on what to expect on closing day.
Call Michele Harmon Team at 713-818-1330 if you have any questions or are ready to begin the home buying process. You can also complete the form below, and a member of our team will be in touch shortly! We look forward to working with you!
