I Have a House "Under Contract". Now What??

Whether you are a buyer or seller you may wonder what the process is and how you are protected once a home is "under contract" or as they some say "in escrow".   Lets look at the process in Georgia. 

1) All parties have agreed on a contract and the buyer has put earnest money into escrow (typically held in a Real Estate Brokerage account to protect the money for all parties until closing) . 

2) Buyer will begin thorough evaluation of credit.  You were probably pre-approved but now you will be required to document your credit worthiness which will probably include:

• Verification of employment
• Verification of funds to close (downpayment and your portion of closing costs).
• Verification of debts
• Verification of assets
• May need tax returns if self employed or W2s if employee.
• Other documents like VA certificate of eligibility if it is a VA Loan. 
• My advice is to cooperate with the lender and get everything they need as soon as reasonably possible even if it seems unnecessary.  This will expedite the process and ensure you close on time! 

3) Buyer will also begin inspections of property within time frame of due diligence period (typically 10 -14 days) including:

• Inspection of systems
• Termite inspection
• Structural inspection
• Any other inspections deemed necessary. 

4) Buyer will have an appraisal of the property to evaluate whether the price in the contract meets the minimum appraisal guidelines based on past sales and other factors.  This is typically ordered by the lender and completed by a certified appraiser.

5) Lawyer will examine the title to make sure the seller can convey a good title that is clear from any encumberances.  

6) The money from the lender is put into the lawyers escrow account along with the buyers earnest money and down payment and any closing costs needed.  This is typically all done the day of closing.  

At closing! 

7) The buyer will sign paperwork needed to purchase the property including any documents required to obtain loans to acquire the property. 

8) The seller will sign all documents required to convey good title to the buyer. 

9) Both Buyer and seller will sign a document called a HUD1 which shows how all the money will be dispersed and to whom.  

10) The lawyer will disperse all the money to pay everyone involved in the transaction, pay off the existing mortgage, taxes, and any other encumberances on the property to ensure that the new owners will receive clear title to their new home! 

Congratulations you have either bought or sold your home!! 

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