The Real Estate Purchase & Sale Process: The Mystery Explained

Tuesday, August 25, 2015 | 8:36 pm

For most of the public, the process of buying or selling a home is one of the great mysteries of life. And because of that, dons the perception of being a complicated, stressful, but sometimes necessary activity in one’s lifetime. As always, information is critical in understanding a situation and mastering it! Choosing a real estate agency that is able to properly communicate this mysterious process could make all the difference in the world. Not having a clear understanding of the timelines and requirements could have a detrimental effect on any real estate transaction. Below is a comprehensive outline of the process to buy or sell a home.

1. When one decides to sell a home, Sellers should meet with a Kairos Estates Realtor.

A. Sellers receive a free Comparative Market Analysis (CMA), to find out what the home is worth;
B. The listing price & terms are established & a Listing Agreement is signed;
C. A Kairos Estates Realtor will market the property. This may include: professional photographs, virtual tour, flyers, online marketing in over 75 websites, Open House, &/or private showings & more.

2. When one decides to purchase a home, Buyers should contact a Kairos Estates Realtor.

A. Based on individual preferences, a Kairos Estates Realtor will send out free MLS listings to the Buyer.
B. The Buyer obtains pre-approval from a Lender for a loan. The loan officer will need the following information:
1. Residence history for the past two years.
2. Employment history for the past two years.
3. Information about all outstanding loans & credit card balances.
4. Information about savings, checking or investment accounts.
5. Information about any real estate currently owned.
C. A loan approval letter is obtained from the lender. The letter is sent to the Realtor along with proof of funds for the earnest money deposit (EMD) & down payment .
D. The Realtor will being showing available homes.
E. A home that is “ideal” will be targeted & terms of an offer will be discussed. The Realtor will:
1. Contact the Seller’s agent & assist in determining the offer price, terms & timeline for escrow.
2. Advise the Buyer on types of inspection to conduct (i.e., termite inspection, general home inspection).
3. Determine timeframes to remove any contingencies (i.e., inspection, appraisal, loan).

3. The offer is prepared and presented to the Seller.

a. The Seller’s Agent will prepare the offer by highlighting both the strengths of the Buyer & the offer itself.
b. The Buyer’s Agent will present the offer to the Seller, explaining both its strengths & weaknesses.
c. The Seller will either accept, counter or reject the offer.
d. Any counter-offers are discussed, prepared & re-submitted.
e. Once the offer is accepted, escrow is opened.

4. Escrow

a. Earnest money is deposited within 3 business days of acceptance by the Buyer.
b. Escrow orders a Preliminary Title Report (“prelim”) and sends copies to both agents and lender.
c. Escrow instructions and the opening package are sent out which must be completed, signed & returned.

5. Contingency Period – Typical contingencies (based on a 30 day escrow period) include:

a. Inspection contingency – generally removed within 17 days, but the timeline may be negotiated.
(1) As a general rule of thumb, the inspections should occur within a few days after acceptance.
(2) Normally, it takes a few days to receive inspection reports after the inspections take place.
(3) Buyer receives and approves Seller’s Disclosures.
(4) Buyer approves the Preliminary Title Report provided by the Title Company.
(5) Upon reviewing the inspection reports, the Buyer may make a Request for Repairs/Credits.
(6) After a Request for Repair is made, the Seller reviews it and sends a response.
(7) Buyer may accept the Seller’s response or make a new Request for Repairs/Credits.
(8) Either an agreement will be reached between the parties, or the Buyer may cancel the contract.
(9) If an agreement is reached, the Buyer will remove inspection contingencies.
b. Appraisal contingency – generally removed within 17 days, but the timeline may be negotiated.
(1) Usually this contingency is requested when the Buyer is financing the purchase.
(2) After the lender’s appraiser conducts an appraisal of the property, an appraisal report will be generated. This may take a few days.
(3) If the property appraises for the amount of the loan/higher, then the Buyer may remove the appraisal contingency.
c. Loan contingency – generally removed within 21 days, upon loan approval by the lender, but the timeline may be negotiated.

6. Homeowner’s Insurance & Escrow Documents

a. Buyers obtain a Homeowner’s/Fire Insurance policy for their new home & the insurance information is given to escrow for the new lender prior to escrow closing.
b. Seller will need to bring a current photo ID to sign the notarized Grant Deed.
c. Buyers need to bring a current photo ID to sign the notarized Deed and loan documents.
d. Copies of title and lender documents are given to the Buyers.

7. Down Payment and Closing Funds

a. The escrow officer provides the Seller with a Seller’s Estimated Closing Statement, which itemizes costs & total monies to be received from the sale.
b. The escrow officer provides the Buyer with a Buyer’s Estimated Closing Statement, which itemizes costs & total monies due.
c. Buyer provides a cashier’s check or wires closing funds to escrow several days prior to closing.

8. Funding — The lender sends funds to the Title Company.

9. Close of Escrow

a. Escrow orders buyer’s Home Warranty policy, pursuant to the contract.
b. The Title Company records the deed at the County Recorder’s office. (Buyer & Seller will receive their copies from the County Recorder in approximately two months.)
c. Keys are transferred from Seller to Buyer.
d. Buyer and Seller will receive a closing packet from escrow by mail which must be retained for income tax purposes.

CONGRATULATIONS! The sale or purchase transaction is complete! Choosing the right real estate agency is critical in navigating through this tedious process. Kairos Estates puts an emphasis on providing the highest quality luxury real estate concierge service. All of the paperwork associated with a real estate transaction can be overwhelming. Working with a Kairos Estates Agent, clients receive a free USB drive containing all of the paperwork at the close of escrow. Clients enjoy all the white-glove service of a boutique real estate agency at unbelievable commission rates and bonuses. Visit www.KairosEstates.com to view the comparison chart of how this agency compares with other average brokerages. With Kairos Estates, each real estate transaction is not just business; it’s personal.

Kairos Estates may be contacted at 501 W. Glenoaks Blvd. #449, Glendale. For more information, call (818) 632-9429 or visit www.KairosEstates.com.

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