We often write about timing in real estate. Most every component of a real estate transaction has a timing factor and they all must work together to have everything come together in a timely manner for a smooth close of escrow. It is important to recognize the relative timing of each component and the fact that they must be completed in their own time allowance, not that of the whole.
The timing starts with the offer. Offers contain a time limit by which the seller, or in the case of a counter offer, the buyer, must accept the terms presented. They are not binding if you are going to counter them, but if you accept the offer outside of the time provided for acceptance you will need to take extra steps to tighten up and validate the offer.
Once the offer is accepted there is a limited time in which the earnest money deposit must be submitted to the escrow holder. If that timing is missed the contract may be subject to cancellation. On acceptance, many timing components are triggered. The preliminary title commitment must be submitted withing a certain time frame and, on receipt, the buyer has a set number of days within which to submit any objections to its findings.
Then there are the inspections, tests and investigations. These are scheduled for completion within an agreed upon time frame. It can change depending on the scope of the work to be done and the nature of the market. In a busy market the inspectors aren’t always readily available. The agents should know that and make allowances for potential delays in the date agreed to for the close of escrow.
If getting a loan, it must be applied for within five days of acceptance. Then the loan process timing occurs. There will be an appraisal which takes time to get contracted, the property inspected, and the report prepared and submitted. There is information that must be given to the borrower at least three days in advance of the loan funding. This is a common trap if there are delays along the way for the information can’t be given to the borrower until all loan matters, inspection and other escrow matters are completed for a total package. Do all the little things in a timely manner so you can fund on time and this one doesn’t get you.
If repairs are necessary it can be difficult getting them completed within the time provided for the close of escrow. Be sure to get inspections done quickly and don’t delay your decision on approving of the condition of the property. You can save time by not asking for repairs, rather have an agreement for a credit if the repair is not something would mandated by a lender to be completed prior to funding.
Be diligent getting things done in a timely manner so you aren’t asking for a time extension needlessly. If you miss your close date there is no obligation for the other party to stay committed to the transaction. They usually do, but you do expose yourself to losing your seller or buyer after investing time and money to the transaction you could lose. Sometimes people change their minds about a transaction and are looking for ways to get out. Don’t chance it – do your work and make sure your agent is doing his.
Don’t assume you will get an extension for performance on any aspect of the transaction, or the transaction itself. Things happen. Maybe somebody wants to pay more. Maybe a family member wants the house. Don’t let things happen to you because of timing problems.
When it comes to choosing professionals to assist you with your Real Estate needs… Experience is Priceless! Jim Valentine, License No. BS-03481, RE/MAX Gold Carson Valley 775-781-3704. dpwtigers@hotmail.com.