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How to Buy a House | 10 Steps to do Once Your Real Estate Contract is Accepted | Home Buying Process - YouTube
Channel: Matt Leighton
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So you just found the home of your dreams,
you put in your offer and it was accepted!
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And now youâre thinking, now what?
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What do I do next?
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Well, you came to the right spot.
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Howâs it going everyone, Matt Leighton,
welcome back to another real estate video.
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Hey, if this is your first time here, be sure
to hit that subscribe button so you never
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miss an update.
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Ok so in this video weâre going to go through
the 10 things that you as a buyer need to
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do to once you go under contract or open escrow
or whatever it is your market calls it when
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the buyer and seller agree and sign, the signing
part is critical, and sign the contract.
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If youâre a seller, most of these items
will be relevant, but itâs most relevant
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for those buyers out there that just ratified
the contract.
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Letâs begin-
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Number one is donât celebrate.
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Guys the fun part is just getting started!
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There is still a lot of work that needs to
be done in order to get you to settlement
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and get you there on time with no delays.
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Have you seen those videos of the track and
field athletes celebrating, arms in the air,
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with 100 meters left only to lose the race?
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That could be you.
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Weâre halfway through the process so it
doesnât make sense to start popping bottles
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right now.
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If you want, have a nice glass of wine, or
one adult beverage of your choice.
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Reflect on the process so far.
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Thank yourself that you wonât have to spend
your weekends looking at houses.
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But thatâs it!
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Itâs back to work.
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Now is not the time to celebrate.
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The second thing to do is to write out all
your contingencies.
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Depending on your offer, your contract may
be contingent on one item, or it may be contingent
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on 6 different things happening.
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The most common contingencies are the home
inspection, condo or HOA document review period,
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financing, and the appraisal contingency.
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Write out each contingency in your calendar
and work backwards from there so none of them
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sneak up on you.
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The goal here is to keep you on-top of all
your to-do items and to keep you out of default.
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Remember, contingencies run concurrently and
start at the time the contract is ratified.
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HOA and condo docs must be received for that
contingency to start, but other than that,
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as soon as you ratify, the clock is ticking.
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3 is EMD.
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Here in Virginia, the Earnest Money Deposit
is usually deposited within 3 days after date
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of ratification.
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So after your offer is accepted, you should
be expecting your real estate agent to collect
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your EMD if they donât already have it in
the first place.
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The amount of the EMD should be around 1%
- 3% of the purchase price.
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Iâve done a video covering the EMD before
so be sure to check that out.
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And guys, I get it if you have to move around
some funds, but be sure that the money is
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in the right account.
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You donât want to start off your first contingency
by having a check bounce.
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Thatâs not going to go over too well.
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Speaking of contingencies, assuming you have
a home inspection contingency, you need to
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schedule that immediately.
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Most time frames are around 7 days for this
contingency but go ahead and schedule the
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inspection for as early as possible.
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The reason being is that if you were to wait
to schedule this, you could be paying other
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fees like the termite inspection, like the
appraisal fee, and if you wait to schedule
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the inspection, then get back the report and
decide thereâs too much wrong with the house
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and you want to back out, well youâre going
to be out-of-pocket all that money that you
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spent on the other fees.
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And if you wait, you could run the risk of
not getting the report within the contingency
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period, and therefore you wonât be allowed
to fix anything.
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And nobody wants that.
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The fifth thing to do when you go under contract
is to get your lender on speed dial.
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Contracts usually fall apart for two reasons.
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First is the home inspection and the second
is the financing.
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Buyers love spending 4 hours a day looking
at Zillow listings of properties that they
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canât afford, but god forbid a lender asks
for 1 document and âoh my gosh I donât
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have time for thisâ, âis this form necessaryâ.
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âMy friend Johnny who bought a house 10
years ago said I didnât need to do thisâ.
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Okay letâs take a step back.
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Lending has become so regulated that every
lender will need just about the same documents
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from you.
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And since youâre a well-informed buyer,
work with your lender before you go under
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contract, so that when you do, you know exactly
the next steps and what you will need to provide.
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Number six on our list is to stay in touch.
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Pretty much every problem is a communication
problem.
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Now is not the time to go on vacation.
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Now is not the time to take 3 days to return
an email.
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The lender, appraiser, title company, real
estate agent, home inspector, and owner are
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all working hard to get to settlement and
if youâre out-of-touch and nobody can reach
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you, well thatâs just going to throw a huge
wrench into the sale.
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Everybody needs to be on the same page.
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Be responsive.
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Iâve closed deals when the seller was in
California, Europe, Hawaii, you name it.
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If the seller can find the time to sign and
notarize a closing package while in Hawaii,
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I think you as a buyer can find the time to
answer emails within 24 hours.
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Is that fair?
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I think thatâs fair.
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Number seven is to get the estimated costs
of closing from the title company as soon
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as you can.
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My goal is to have you understand every single
line of the Closing Disclosure so, because
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I donât know, it makes sense for you to
know what youâre paying for, right?
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No surprise charges, no hidden fees.
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You should know everything upfront.
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I want you to have this information as soon
as possible.
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Guys, a settlement should take 40 minutes.
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Iâve sat through settlements that have taken
4 hours.
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Line-by-line.
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Every item was read and reviewed by the client.
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Look, Iâll sit through it, but there is
a better way.
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There is a more efficient way.
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Wouldnât it make sense to know all these
closing costs well before closing?
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Of course.
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So go out and get the estimated costs of closing
from the title company.
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Number eight is to think logically, donât
think emotionally.
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Let me tell you what I mean.
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I was working with my client on the sell side
and the buy side.
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They were selling their condo and buying a
townhouse.
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And they were a little upset that the buyers
of their condo were asking for small items
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on the home inspection.
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Things like caulking and re-sealing, and tightening
a few fixtures.
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Meanwhile, my clients get back the home inspection
report on the townhouse theyâre buying and
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what do they do?
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They start asking for the smallest items!
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They want caulking and they want to throw
extra things in the addendum that arenât
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really wrong with the house, but they told
me to include it, âjust to see if they would
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take itâ.
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So I said hey look Iâll do this, but just
know, that youâre acting the same exact
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way as the buyers of your own condo.
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They wanted all the small items to be fixed
on their purchase, but they were almost offended
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that a buyer would want the small items fixed
in their current condo.
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Point being is guys, buying a house or a condo
is going to be emotional.
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This is where your family is going to live,
where youâre going to raise your kids.
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The key is to take a step back, think more
logically.
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What do all parties want?
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Do all parties want the transaction to close?
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Is the other side acting reasonable?
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Ok, letâs work off of that premise and try
to be more level-headed.
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Take the emotions out of it and use a rational
approach.
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Number nine is confirm with the lender, title
company, and real estate agent that all is
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well.
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Let me tell you a quick story.
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I work with a great local lender where I know
that as soon as the contract is ratified and
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they have a copy, their team is hard at work
finalizing the loan.
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I donât even have to pick up the phone to
call them.
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Theyâll call me if something is wrong.
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Now Iâve also worked with a lending company
where I called 2x a week for 3 weeks with
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no response.
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As it turns out, the mortgage officer had
quit and nobody had picked up that file so
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we were 3 weeks behind schedule.
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Moral of the story is to check in every now
and then maybe once a week or once every two
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weeks to confirm everything is still on track.
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You almost want to get to the point where
youâre over-communicaitng.
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Donât get to that point.
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But make all parties aware that youâre on
top of the communication and youâre going
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to be checking in to make sure that all is
well.
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And number 10 on the list of things to do
once you go under contract is to schedule
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your final walk-through for a week before
closing.
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Now if youâre closing in 45 days, it probably
doesnât make sense to immediately schedule
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your walk-through.
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The goal here is to set the expectation that
you as the buyer will be doing a walk-through
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about a week before settlement.
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Guys sometimes the electricity is off, sometimes
weird things happen.
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Donât let closing sneak up on you.
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Donât do the walk-through on the way to
closing.
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Oh, something not right?
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Now settlement is delayed.
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Thatâs the reason you do the walk-through
a week before closing.
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And if the seller is in the process of moving
out, try to do your walk-through after they
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have removed all their belongings from the
property.
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Alright there you have it.
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Those are the nine things you need to do right
after you go under contract, open escrow,
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ratify your contract.
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Guys, what do you think.
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Did I miss any?
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Drop me a comment in the comment section below
let me know if I left anything out.
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And be sure to subscribe for more real estate
videos.
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Thank you very much for watching.
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Until next time, create a productive day.
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Take care.
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