Contract to Closing Checklist
Congratulations! The seller has accepted your offer and you have set the closing date. Now what? We understand how stressul the process becomes AFTER you go under contract. So much to do, where to start? Please reference our outline below so you know what to expect every step of the way. Of course, we'll be there by your side to make sure you have the support you need at every turn.
1. Attorney Review - After both parties sign the sales contract and initial earnest money is dropped off with the selling agent (if applicable), the contract is then sent to the Buyer's attorney and Seller's attorney for review (hiring an attorney is not mandatory, but highly recommended). The review process is scheduled to last up to 5 business days (sometimes longer). During Attorney Review, details of the sales contract will be discussed/modified until both parties are in agreement. Remember, it's better to have everything in writing! Once all Attorney Review items have been addressed, the Attorney Review period will conclude.
2. Professional Inspections and Inspection Notices - During the Attorney Review period, the buyer is given the opportunity to complete any inspection that they choose (general Home Inspection, Radon Inspection, Mold Inspection, Termite Inspection, Well or Sanitary Inspection, Termite Inspection and Pool Inspections are the most common). *Note, inspections are not required, but highly recommended. When the applicable inspection report comes back, the Buyer will review with their attorney and agent and may ask for certain items to be repaired, a credit to be given in lieu of repairs or even further testing to be performed. The attorney's will work together until both parties are in agreement on the home inspection items and a resolution is in place.
2. Homeowner Insurance & Flood Insurance (if applicable) - The sales contract is contingent upon the Buyer obtaining evidence of insurability within 10 Business Days after the Date of Acceptance. As soon as a Buyer clears the Attorney Review period (if not sooner), it is recommended that the Buyer shop around for a homeowner's insurance policy. Be sure to consult with a trusted agent to find the best rates/policy and to discuss insurance in more detail. If applicable, the Buyer will need to provide their mortgage lender info (mortgagee clause) to their insurance agent so the lender can be added to the policy. The first year's premium can be paid up front, or at the closing table.
3. Mortgage Contingency - After Attorney Review, the Buyer will want to shift their attention to the mortgage (if financing and not a cash offer). The Buyer will have to meet two important dates on the contract:
- Intent to Proceed - The Buyer will need to provide proof that they have applied for a mortgage and have submitted papework to the mortgage company showing their "Intent to Proceed" with the loan. The date by which the Buyer will need to show proof is typically 21 days after both parties have agreed to the contract.
- Mortgage Commitment - The Buyer will need to provide proof that they have received a written mortgage commitment from their mortgage lender in advance of closing. This "Commitment," will show that the Buyer has cleared all of the required conditions set forth by the lender to obtain the loan, and that the Buyer is "Clear to Close" on the loan.
The loan process is an ongoing process that begins upon contract and concludes at closing. Be sure to consult with one of our recommended lenders to find the lowest rates/fees and discuss home loans in more detail.
4. Title - Typically after Attorney Review and after providing proof the Buyer has given their Intent to Proceed, at the Seller's expense, the Seller will deliver a titlle commitment for an ALTA title insurance policy in the amount of the Purchase Price with extended coverage by a title company licensed to operate in the State of Illinois. The Buyer or the Buyer's attorney will review the title to make sure the title is "clean" and transferable.
5. Condo/HOA Docs - If the property is a condo or has an association, documents relating to the project or association will be requested and reviewed by the Buyer or Buyer's attorney and Lender to make sure the condo/association meets the purchase guidelines or minimum requirements.
6. Appraisal - If required by the lender or requested by the Buyer, an appraisal will be ordered for the property (paid by the Buyer). The appraisal is ordered by the lender some time after Attorney Review during the mortgage approval process. The purpose of the appraisal is to determine a fair market value for the home to protect the vested parties (lender, buyer, seller, etc.).
7. Survey - Prior to closing, except where the Real Estate is a condominium, Seller shall, at Seller's expense, furnish to Buyer or Buyer's attorney a Plat of Survey that conforms to the current Minimum Standart of Practice for boundary surveys, is dated not more than six months prior to the date of Closing, and is prepared by a professional land surveyor licensed to practice land surveying under the laws of the State of Illinois. The Plat of Survey shall show visible evidence of improvements, rights of way, easements, use and measurements of all parcel lines. The Buyer or Buyer's attorney will review the Survey to make sure there are no issues when acquiring the property.
8. Final Walkthrough - In advance of closing, the Buyer and Buyer's agent will schedule the Final Walkthrough. During the Final Walkthrough, the Buyer will inspect the condition of the home to make sure the condition of the property has not changed since contract and that any applicable repairs were made (if agreed upon) as a result of an inspection.
9. Closing - After all contract requirements have been met, all inspection items have been addressed, the title and survey to the property has been reviewed, any condo/association docs have been reviewed, the Buyer has secured a mortgage and insurance policy and the home appraisal has been approved, it's time to close and transfer ownership! The closing time is agreed to by both parties and will take place at the location of the Seller's choice (either a title office or their attorney's office) on a Monday - Friday. In advance of the closing, the Buyer will review the Closing Disclosure with their lender and attorney so they know how much they will need to bring to closing. If under $50,000, the Buyer can bring a certified check from an asset account they have verified. If over $50,000, the Buyer will need to issue a bank wire from an asset account they have verified. The Buyer's lender will send the closing documents to the closing agent for the Buyer/Seller to sign. The Buyer's attorney will then go over all of the documents with the Buyer, instructing them where to sign. After all loan documents and property transfer documents have been signed and approved and the additional money to close has been verified, the title agent will fund the transaction and the Buyer will receive keys to the home!
All the above may seem rather overwhelming. That is why having a Republic Realty Group professional represent you and keep track of all the details for you is an absolute must! Please contact us today to learn more about our Buyer representation services in more detail.