You Found Your Dream Home, Now What?
After relentlessly searching for your dream home, you found out, congratulations! Now what? Let’s talk about it!
Step One
The first step after finding your dream home is to work with your Realtor to come up with the most competitive offer. A competitive offer will vary depending on the current status of the real estate market, but currently in Sarasota we are still a seller’s market, however it is shifting quickly back to a buyer’s market. When submitting offers, I will be looking at recent comps sold in the area, days on market, and will be chatting with the seller’s Realtor to find out exactly what the seller is looking for in an offer. The terms of the contract are almost as important, and in some cases, even more important than the actual price being offered on the home so it’s important to know what the seller needs. After all of this is finalized, your Realtor will submit your offer to the Listing Agent. The average expiration of the offer is 24-48 hours and the seller needs to respond within this time frame.
Step Two
The second step is the seller responding to your offer. There are a few scenarios that can happen during this step: 1. the seller counters your offer and you can either counter back, or accept. 2. the seller accepts your offer and you’re officially under contract 3. the seller declines your offer or accepts another offer - if no other offer was accepted, your Realtor can submit a new offer with different terms/price, etc. or you go back to your search. If you counter and are accepted, or your offer is accepted right away and you are under contract on your home, CONGRATULATIONS!
Step Three
Once you’re under contract, you are now in step three! This is when you will be making the good faith deposit that is held in Escrow by a third party, in Florida, the third party is usually a title company. The good faith deposit is typically 1-3% of the purchase price but it’s completely up to you what you wish to put down. This is your “skin in the game” deposit and will be deducted at closing from your closing costs. If you or the seller breach the contract in any way, you or they will be at risk of losing your good faith deposit so it’s super important that you, your Realtor, title, the listing agent, and the mortgage lender are all closely following the dates listed in your contract. Also, during step three, you will be scheduling your home inspections with a trusted, licensed, bonded, and insured inspection company. Your Realtor typically has a company that they work with and will recommend to you. There are multiple inspections that can be scheduled such as a Wood Destroying Organism (WDO) inspection - this will check for termites, certain wood boring beetles, and wood decay fungi, a 4Point inspection which is required by insurance companies, Mold inspections, sewer scoping, and general home inspections. Once you schedule your home inspection, you and your Realtor will attend the home inspection and will receive the full report within 24-hours. After receiving the report, your Realtor can go back to the listing agent and negotiate any repairs needed.
Step Four
Step four is the time after you’ve completed your inspections, negotiated any repairs, made your good faith deposit, and are preparing to close. This time is used by your mortgage lender and the title company to prepare for the closing. Make sure you aren’t making any large purchases, opening lines of credit, or quitting or losing a job during this time because you could affect your ability to keep your financing. You will be using this time also to shop for homeowners insurance, transferring utilities to the new home, and packing up your current home to move into the new one. Also during step four, your mortgage lender will be ordering and performing a home appraisal to mitigate any risks from the lending side. Your lender will provide you with the appraised value of the home once they have it finalized. If your home doesn’t appraise for the price that you’re under contract for, you can either pay the difference in cash at closing, or your Realtor can renegotiate the sale price with the seller.
Step Five
Congratulations, you’ve made it to the final step! You will be receiving the closing disclosure within three days of your closing date, so make sure to review this in detail as it will outline the terms of your loan, final closing costs, and any outstanding charges or fees included in your loan. The day before closing, you and your Realtor will perform a final walk-through of the property to ensure it’s in the exact shape it was when you went under contract, and you will ensure that any repairs requested have been fixed. At the closing table, the property title will pass from the seller to you. You will be signing legal documents and paying all closing costs at this time. Once all of this is completed, you will get keys to your property and you officially own your dream home!