We Have An Offer - Now What?!
We have an accepted offer! This is when the clock starts ticking...
Phase 1: Offer & Acceptance
Offer & Acceptance (or Counter Offer & Acceptance) is now completed.
Phase 2: Due Diligence
Time is of the Essence.... This is the time that the buyer has available to accomplish their due diligence, financing, inspections, insurance, etc. It's normally 10 days, weekends included. We can always ask for more time, but it does not mean that the Sellers have to grant it!
2.1 Approvals & Reviews
The buyer has to get the documents to the Professionals that they have selected -Mortgage, Lawyer, Insurance, etc.
2.2 Legal Review-Mortgage Approval
2.3 Mortgage Approval
The buyer's agent will have forwarded the Agreement of Purchase and Sale to their mortgage contact, who will review and submit to the mortgage lender for approval if financing is required for the purchase.
2.4 Property Taxes Depends on the property, but here is how it works...If you have paid your property taxes for the tax year, and for arguments sake, let's say that they are $1,200 per year, and you close on the property on June 30th, then they would owe them 4 months taxes (July to October) or 4x$100=$600. Your lawyer calculates this for you.
2.5 Insurance Coverage
Do not cancel YOUR insurance til the day after the closing date!
They will book the Inspections\Inspectors that you select. It is always preferable that you are absent for the inspections. It can take up to 4 hours.
Types of Inspections:
- Building Inspection(s) - This inspection usually includes a thermal scan of the home to determine if there are any unseen issues in the walls and ceilings,
- Water Quality-Quantity - Usually only performed on well systems, but not always!
- Sewer-Septic Scope - Used to determine if the "laterals are trouble free"
- Radon Gas - Radon is a colourless, odourless, cancer causing gas than can accumulate in basements, it is easily remediated (usually at the sellers expense). Learn more about radon here.