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Escrow Inspections and Appraisals

CONGRATULATIONS your offer was just accepted! First, let’s breathe – the hardest part is over, you actually found the home you love! You are probably asking yourself, ‘what happens now?’ Here is a cheat sheet to help you stay one step ahead of the game. With the submission of your offer, you should already be pre-approved and have submitted your pre-approval letter to your broker. Yay! That’s a huge step… Now let’s dive into the transaction process.

1. Know the Key Players

You will want to identify the key companies involved in your contract. Copper West Real Estate and your Broker; your Escrow and Title Company; your Lender and your Home Warranty Company (if you need one). You will also probably need a Professional Home Inspector (if you don’t have one, recommendations are available from your Realtor) and any other Professional Inspectors you might need to line up for home before your contingencies expire.

Please note, time starts ticking once the contract is mutually accepted.  

2. Determine Your Dates 

Contract Dates are critical. You want to make sure you have your important dates in order, so you don’t miss and fall out of contract. Let’s work off this easy timeline:

a. Date of Acceptance – this is an important date, as it sets the timeline for important deadlines (ie. earnest money, contingencies, and closing).

b. Pre-approval Letter Date (if you did not submit one with the offer) OR Proof of Funds Date,
if your deal is cash.

c. Promissory Note Redemptions Date (usually 3-5 business days from mutual acceptance). This is the date your earnest money needs to be deposited into escrow at the Title Company.

d. Contingency Dates (to stay in compliance with the contract these are VERY IMPORTANT):

i. Financing Contingency and Appraisal: This is important, because this is subject to 1) Buyer and the Property to qualify for the loan from Lender; 2) Lender’s appraisal shall not be less than the Purchase Price. Both are solely for your benefit and of course, can be waived by you in writing at any time.

ii. Title Insurance: Once the Preliminary Title is received, the buyer has 5 days to notify the Seller in writing with any matter. A Buyer’s Agent and Seller’s Agent are not qualified to advise on specific legal or title issues.

iii. Professional Home Inspection / Private Well / Onsite Sewage System: In all contracts, the buyer is granted a risk-free number of business days to perform an inspection on the property. The inspection can be far ranging from; building permits, to whole home inspections, to well tests, to boundary lines. If, after a period of time, but BEFORE the home inspection period runs out, you decide you don’t want to purchase the home, you can terminate the contract. Depending on the location of your property, other inspections are used in addition to the regular home inspection. An example of this would be a well inspection, for a property with its own water source, or a septic inspection for a property with a septic system. However, if you want to continue purchasing the home SUBJECT TO repairs to be completed by the Seller, then you can do that too, but remember that all negotiations about repairs need to be completed within the home inspection timeline or you are deemed to have accepted the condition of the property. We will often have a termination agreement ready to go if things are getting close, just to be safe.

a) Typically, you start with calling a home inspector. (Located under “Home Inspectors” here) and set up an appointment. This is an arrangement set up by you, and paid directly to the home inspector. The inspector will call the listing agent to set up the access, however. It usually costs $400 or so.

b) The inspector will show up, inspect the house, and at the end we all sit in on a presentation from him/her about the condition of the home. Some inspectors just submit a report to you via email, but recently inspectors have been presenting to the clients, which is quite nice.

c) After that, you decide what you would like to do, and we help you re-negotiate, or just accept the condition of the home (it’s about a 50/50 mix). Interestingly, in the vast majority of the cases, the repairs are less than $500.00. If they are over $1,000, and higher (except for common things like a roof replacement, a higher cost item that isn’t overly technical) negotiations can prove difficult, but usually work out. It’s important to know, however, that when deals come apart, they usually come apart because of emotions, not large dollar amounts.

iv. Lead Based Paint period: If the property was constructed prior to 1978, a Lead-Based Paint Addendum will be given to the buyer and the buyer has 10 days to perform any inspections.

v. Property Disclosure Law: Buyer and Seller acknowledge that unless this transaction is otherwise exempted, Oregon law provides that buyer has a right to revoke Buyer’s offer by giving seller written notice within 5 business days after receipt of the Seller Property Disclosure.

There are few ins and outs of tracking and counting all of these timelines and it is the job of your Broker and the Copper West Properties Transaction Manager, to help you stay on track and within compliance of your contract. We are here to help!

3. Important Terms You Should Know

Personal Property: Not attached, moveable (i.e. furniture, pictures, stand-alone microwave)

Fixture: Attached to the structure, immovable (i.e. chandelier, blinds, built-ins)

AS-IS condition: Buyer assumes all risks of adverse conditions that may be discovered after closing. Please note: The AS-IS clause will NOT protect a seller from liability if known adverse conditions in the home are intentionally concealed from the buyer. 

4. Both Buyers and Sellers sign documents at the Escrow company.

5. Documents go back for one final review, and about 48 hours after the last person has
signed, drumroll… 
You own a home!