What to Do After You’ve Found a Home You Love

What to Do After You’ve Found a Home You Love

  • John O’Neill
  • 12/26/22

For many people, buying a home can be an exhilarating moment in their lives. Whether it is their first home or their seventh, searching for Pine Ridge Estates real estate can be a roller coaster of emotions. After a long period of searching Pine Ridge Estates homes for sale, there is no greater joy than finally finding your dream home. So what are your next steps? That’s where the real work begins. Here’s what you need to know to secure your dream home and what you need to do before closing day.

Submit an offer for your dream home

Once you have found the home of your dreams, act quickly! If you are searching for your dream home, chances are someone else is interested in it, too. The last thing you want to see happen is someone else purchasing your home because you did not submit an offer in time. So what are the steps you need to take to ensure you secure your dream home?
Sit down with your buyer’s agent and draft an offer. Figure out what you want to offer for the purchase price and the earnest money. What is earnest money? Earnest money is a good faith deposit on the home, which tells sellers you are financially committed to purchasing your home. In exchange for assuring the seller you are serious about buying their home, the seller agrees to take the home off the market until either one or both parties walk away from the purchase, or the deal goes through. In general, earnest money should account for 1% to 3% of your total purchase price, yet you can offer up to 10% in highly competitive real estate markets.
Along with earnest money and a purchase price, you and your agent should consider contingencies. Do you want to include contingencies in the purchase agreement? Contingencies are a buyer’s greatest safeguard should something go wrong with the deal. Contingencies also give the buyer the right to walk away from a purchase agreement without penalty, assuming there is an issue that is no fault of their own. Some of the most popular contingencies buyers attach to their purchase agreements include:
  • Home inspection contingency
  • Financing contingency
  • Appraisal contingency
  • Home sale contingency
In some cases, buyers also include title contingencies, but this practice is less common in purchase agreements.

Home inspection contingency

Whether you are purchasing Pine Ridge Estate condos or luxury homes, a home inspection contingency is recommended for most home purchases. In fact, home inspection contingencies are one of the most common contingencies, with up to 88% of homebuyers including home inspection contingencies on their purchase agreement. So what is a home inspection contingency, and why is it crucial for your home purchase?
A home inspection contingency is where a homebuyer or seller hires a certified home inspector to examine the property to determine whether or not there are any hazards or material defects within the home. A home inspector takes a visual assessment of the property, both on the exterior and interior of the home, to make sure that the property is structurally sound and safe for the buyer. Every home inspection digs up some issues with the home, even in brand-new builds. It is their job to point out every minute detail they come across and report on it. Buyers have the option to attend a home inspection. Although it is not required, many agents recommend it, especially for first-time homebuyers, since it will give them insight into the inner workings of their future home.
A home inspection must be conducted within a certain time frame once there is an accepted offer on the home. It is also one of the first home contingencies that are usually carried out. If a home inspector finds a major issue with the home, such as a damaged roof, buyers can go back to the sellers with three options:
  • Request the seller makes the repairs at their own expense prior to closing
  • Request the seller lowers the asking price so that the buyers can pay for the repairs
  • Walk away from the purchase agreement if you and the seller cannot come to an agreement
If the seller is either willing to pay for the repairs or lower the list price, then you can move forward with the sale. If not, then you have the option to walk away from the sale without penalty, meaning you will receive your earnest money back. Depending on what you do, you either move forward with the deal or start the search process all over again.

Financing contingency

With the exception of cash buyers, the majority of homebuyers rely on lenders in order to secure funding for their dream home. Whether buyers have a conventional loan or a government-issued loan, such as FHA or VA, the majority of lenders will require a financing contingency in order to move forward with the purchase agreement. A financing contingency lets the sellers know buyers will have the funds to purchase their property. In the event buyers cannot secure funding for their mortgage, buyers have the option to walk away from the purchase agreement without surrendering their earnest money.

Appraisal contingency

Similar to financing contingencies, an appraisal contingency is typically required if a buyer is going through a lender in order to secure funding for their dream home. An appraisal contingency is where a professional appraiser determines the home’s appraised value. If the appraisal comes in at or above the asking price, then the property appraises out. If the appraised value comes in below the asking price, then the buyers have a few options: they can ask the seller to reduce the asking price to the appraised value, the buyers can agree to pay the difference between the appraised value and the asking price out of pocket, or the buyer can walk away from the purchase without penalty.

Home sale contingency 

For those who currently own a home, many buyers need to sell their current home in order to pay for their future home. In this case, you may want to consider including a home sale contingency on your purchase agreement. This means you will move forward with the purchase agreement on the condition that your current home sells first. While this contingency is not as common in a seller’s market, sellers might be more willing to agree to this contingency if they live in a competitive real estate market.
Contingencies can play a major role in the purchase of your future home. Whether or not you choose to include them in your purchase agreement, they add an extra layer of protection for a buyer’s investment. From there, you are one step closer to securing your dream home.
Are you ready to purchase your dream home in Pine Ridge Estates? With over a decade of industry experience, John O’Neill is your trusted Pine Ridge Estates realtor. Contact John today to get started on your house hunt.

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