Hi This is Don Thompson again, your local real estate expert advisor. So let's recap... You've been pre-approved, found a house and negotiated a deal. Things really get going now... and for a short time, you are going to be moving on three fronts.
One, you'll need to need to sign the purchase agreement and deliver the deposit, two, you'll schedule and do your inspections and three, you have to formalize the loan application.
So let's discuss signing the purchase & sales agreement , also known as the p&s or the purchase agreement. This document should be reviewed by your attorney before you sign. He or she will want to make sure that there are certain clauses included that protect your interests. And the seller will also have their attorney look at the agreement.
Just so that you’re aware, your attorney, if he or she is processing the mortgage documents, is also the bank’s attorney and at the closing they will be representing the bank. Sometimes there are actually two attorneys on the buyer side, one for the buyer and one for the bank. However, locally the attorneys will represent you regarding things that deal with the seller, and make no mistake about it, when you are dealing with the bank, they are working for the them and looking out for their interests.
When you think about it, there are actually two transactions happening at the closing...one the seller is transferring the property to you and the second, if you are getting a mortgage, the bank is lending you tens of thousands of dollars and it’s using the property as collateral. For the first part. you and the bank have basically the same interest… you are getting the property in marketable condition, free and clear of any liens and the bank wants the same thing because it is their collateral. The second transaction is between you and the bank… this process is highly regulated, you’ll see the governments initials on many of the forms, HUD, RESPA. The main thing you want to be sure is that you are paying the interest rate you were quoted. and because of regulations today, the fees that you are charged have to be fairly close to what was quoted you.
But I digress, so now, once the contracts are reviewed by both attorneys and they have agreed to the language, typically, you as the buyer, will sign it first and give up your earnest money, your deposit. And then the sellers will sign. Now it’s critical that this document gets signed by all parties as quickly as possible.
This is the formal agreement between you and the seller and until it’s signed you may not have a, what is referred to as, an enforcable contract. So everyone should be working to get it signed as soon as possible.
So now you have signed contracts, you will want to schedule your inspections and let your ;loan officer know that you’ve got a deal.
Inspections are a very important step in the home buying process and I will be covering them in my next video.
Meanwhile, if you have any questions about anything, where I may be able to help you, please do not hesitate to contact me by calling or texting 413.221.9981 or hit reply to this email and I will get back to you as soon as possible.
Thanks again and have a great day!