Escrow Inspection and Appraisals
Inspection and Appraisals
Most buyers will have the property inspected by a licensed property inspector within the timeframe that was agreed upon in the purchase agreement. Some buyers will have several different inspectors inspect the property, if they wish to obtain professional opinions from inspectors who specialize in a specific area (eg. Fireplace, mold, sewer line, roof, HVAC, structure). If the agreement is conditional upon financing, then the property will be appraised by a licensed appraiser to determine the value for the lending institution via third party. This is done so that the lending institution can confirm their investment in the property is accurate. Hartman Cole, as your listing agent, will meet the appraiser at your property and inform the appraiser as to the local comparable sales. This meeting and data will often help overcome any appraisal issues before they develop. Often, a buyer will have an appraisal contingency of 17 days or more in their offer.
The Closing Agent.
In California, we use the escrow process and an escrow officer will be selected as a closing agent in conjunction with a title company. The escrow officer will hold the deposit in escrow, prepare escrow instructions and process the requirements of the contract. The title company will research the complete recorded history of the property to ensure that the title is free and clear of encumbrances by the date of closing and that all new encumbrances are properly added to the title. Some properties are subject to restrictions which limit various activities such as building or parking restrictions. There may be recorded easements and encroachments, which limit the rights to use the property. The Hartman Cole Team includes Stephanie Wolf and Meghan Barr of Pickford Escrow as well as Mitch Litrov of California Title. Both companies are well known for their operational excellence.
A contingency is a condition that must be met before a contract becomes legally binding. For instance, a buyer will usually include a contingency stating that their contract is binding only when there is a satisfactory home inspection report from a qualified inspector and a complete investigation by the buyer of the property.
Before completing his or her purchase of your property, the buyer goes over every aspect of the property, as provided for by purchase agreements and any applicable addendums. These include:
- Obtaining financing and insurance.
- Reviewing all pertinent documents, such as preliminary title reports, Homeowner’s Association documents and disclosure documents.
- Inspecting the property. The buyer has the right to determine the condition of your property by subjecting it to a wide range of inspections, such as roof, termite/pest, chimney/fireplace, property boundary survey, well, septic, pool/spa, arborist, mold, lead based paint, HVAC, etc.
Depending on the outcome of these inspections, one of two things may happen:
1. Either each milestone is successfully closed and the contingencies will be removed by the buyer, bringing you one step closer to the closing; or
2. The buyer, after reviewing the property and the papers, requests a that you repair some items on the inspection report or you issue a dollar credit to the buyer toward the repair. The buyer can cancel should their not be an agreement on repairs.
Hartman Cole will help you to respond objectively and fairly to the buyer when a renegotiation is initiated, while always acting in your best interest. As professional, expert listing agents, Hartman Cole can make a real difference in the outcome of the transaction. Having dealt with hundreds of property sales in the past, Hartman Cole guarantees our total commitment to every client, no matter what their situation is.
We guide you to accept buyers who have a lender’s pre-approval, approval letter, or written loan commitment, which is a better guarantee of loan approval than a pre-qualification or no documentation from a lending institute. Formal loan approval can take 17 to 25 days from acceptance of the agreement if the buyer has not already started the loan process with their lender. Often, a buyer will have a loan contingency of 17 days or more in their offer. Just prior to the lender funding the loan, an appraiser from the lender’s company may come back to review your property and verify that the sales price is appropriate and check that the previous appraiser’s report is accurate.