Here’s the timeline of a typical transaction if you’re a buyer, if purchasing with a loan. Every transaction is different, this is just an example of a timeline — do not use it for your timeline. I’ll send you your exact timeline after your offer is accepted.
A contingency is a clause that is included in the contract that allows you to back out of buying the house if the terms of the clause aren’t met. For example, the inspection period is also referred to as the inspection contingency because if you decide the home does not meet your expectations, you can back out of the transaction. Imagine a contingency as a hoop we have to jump through during the process. Contingencies are marked with a star *.
An escrow company acts as the neutral third party during this closing process. Their job is to collect all the funds and documents needed to transfer the property from seller to buyer, coordinate paperwork and signing for both parties, research the title, and record the deed. You’ll often hear that we’re ‘in escrow’ during this process. We sometimes refer to them as ‘title’ or ‘title companies’.
Business Days 1-3
Your Offer Is Accepted!
Congratulations on your offer being accepted! The business day after acceptance is day one of the transaction.
I’ll open your account with escrow today, so they can get started on their end. Escrow will order a title report, and send it to you to review. If you have any questions about the title report, please contact escrow – they can help.
Your first to-do item is to get your earnest money to escrow (you have three business days to do this, but the earlier, the better).
Business Days 1-5
Disclosure Period / Due Diligence *
We’ll go over the seller’s disclosures now. You can exit the transaction due to the disclosures during this time. Sometimes this contingency is waived if it’s a competitive offer situation.
If you have any concerns with the disclosures, please let me know as soon as you can, so we have time to figure out what to do before this period ends.
Business Days 1-10
Inspection Period *
Day one also begins your timeline for inspections. We’ll typically order inspections day one or two, as soon as we can. I recommend a normal inspection, as well as a sewer scope, a radon test, and a buried oil tank scan.
The Oregon contract automatically gives the buyer ten days to do the inspections, gather bids, and negotiate with the sellers (if possible). We may change this to less than 10 days if it’s a competitive offer situation.
Before the end of this period, you’ll have to decide if you want to continue or cancel this transaction. Once we reach the end of the inspection period, you’re bound to continue the transaction unless the appraisal comes in low, so please discuss any issues you may have as soon as possible.
Sometime around the 2nd week
The next step is appraisal. The lender will order an appraisal and send the report back. If the appraiser believes the home is worth more or equal to the value of the offer, you’re good to go on to the next step.
If the appraiser believes the home is worth less than the offer, unless we’ve written a very aggressive offer and removed this contingency, you can try to negotiate the offer price down, make up the difference, or withdraw from the transaction. And sometimes a low appraisal can be successfully challenged and redone.
Usually week 2-3
Your loan documents are all sent to underwriting to review. Once approved, they are sent back to escrow to be prepared for signing. Once escrow has your loan documents, they’ll schedule a time for you to sign.
A few days before closing
Today is the day you sign your loan documents. Bring your ID and funds to close (cashiers check). If you are not in Portland, often escrow can send a mobile notary to your location to sign. This is usually done a few days before closing to allow for funds to clear.
Last day of transaction
Loan Funding and Deed Recording
The money has been received by the lender and transferred to the correct parties. Then the deed to the home is recorded with the county.
Last day of transaction
Once we get notice the deed has been recorded, you are the new owner of the home! I’ll meet up with you to give you the keys.
Other things to note:
- Your lender will be asking for lots of things from you, starting day one. You’ll have to fill out the loan application, and upload a ton of documents verifying income and more. It can be overwhelming! Please reply to your lender’s requests ASAP. The sooner you can do this, the more likely we can keep everything else on track. While the first two weeks are really hectic, it usually calms down after.
- You’ll also have to research and set up homeowners insurance. I recommend getting a few quotes, and to check if it’s any cheaper to roll in your car if you have one. Your lender will give you a timeline on when this is due.
- Do not take out new lines of credit or close any lines of credit (credit cards, new car loans, etc.) while in this process! Do not run up a lot of credit card debt buying stuff for the home either, use your credit card as you normally do unless instructed by your lender. This goes for anyone on the loan.
- Do not quit your job or change employment or income during this process, this also goes for anyone on the loan.
- I work with two great transaction coordinators over at Neighbors who help me get all the documents lined up. I’ll introduce you to them on day one!
- Remember to breathe and take care of yourself! It will all be over soon enough.