From Contract to Keys

The time between an accepted offer and closing day is known as the “escrow” or “pending” period, typically lasting 30 to 45 days. Here is a step-by-step breakdown of what happens during that timeframe:

1. Opening Escrow & Earnest Money: The buyer immediately submits a good faith deposit (Earnest Money) to a neutral third-party escrow account to lock in the contract.

2. Title Search: A title company investigates the property’s legal history to ensure there are no hidden debts, liens, or ownership disputes, ultimately issuing title insurance.

3. The Home Inspection: The buyer hires licensed inspectors to thoroughly evaluate the property’s condition. Depending on the results, buyers may negotiate repairs or credits with the seller.

4. The Appraisal: The buyer’s mortgage lender hires an independent appraiser to confirm the home’s fair market value matches or exceeds the purchase price.

5. Mortgage Underwriting: The lender does a deep dive into the buyer’s finances, verifying income, debt, and credit history to finalize loan approval.

6. “Clear to Close”: The underwriter gives final approval, and the buyer receives a Closing Disclosure detailing the exact cash needed for closing day.

7. The Final Walkthrough: A day or two before closing, the buyer tours the home one last time to ensure agreed-upon repairs were made and the home is in the expected condition.

8. Closing Day: Both parties sign the legal documents, the lender funds the loan, the title is recorded with the county, and the buyer officially gets the keys!