Inspections & Appraisals

The Process

Initial Agreement and Deposit

An effective agreement is a legal arrangement between a potential purchaser and the property’s seller. Some important tips to keep in mind to streamline the process:

• Keep written records of everything. This includes verbal agreements, counter-offers, and addendums. We can assist drafting all written records and provide copies for each party.
• Keep up with the schedule. You and the seller will be given a timeline to seal every stage of the real estate closing contract.

The Closing Agent

Once both parties have agreed to the contract and all documents are signed, a title company or attorney will act as the closing agent, also known as escrow. At this stage, you will submit your deposit, and the closing agent will serve as a neutral third party responsible for holding and managing all funds related to the transaction until closing.

They will also conduct a thorough title search to ensure the property is free of any liens or encumbrances and that ownership can be transferred properly. Before closing can be completed and ownership officially transferred, all contingencies outlined in the Purchase Agreement must be satisfied.

How to Hold Title

There are several ways to hold title, or ownership, of a property, and each option carries different implications for financing, taxes, and transfer of ownership. It is important to understand which option best fits your situation. We recommend consulting with an attorney or tax advisor to review the advantages and considerations of each method. We are happy to connect you with trusted professionals to help guide this decision.

Property Inspections

As part of the Purchase Agreement, you will schedule a licensed property inspection within the agreed timeframe. Inspectors will evaluate the overall condition of the property and identify any potential issues. Depending on the property, you may also choose to bring in specialized inspectors for areas such as roofing or plumbing.

For commercial properties, additional requirements such as environmental audits or soil testing may be necessary. If inspections uncover concerns not previously disclosed, you may have the opportunity to renegotiate the terms of the agreement. Once you are satisfied, contingencies can be removed and the transaction can move forward.

Appraisals and Lending

Stay in close communication with your lender throughout the process to ensure all required documents are submitted on time. If your purchase is contingent on financing, a licensed appraiser will be assigned to determine the property’s value. This ensures the investment aligns with market conditions.

Appraisers evaluate factors such as construction costs, square footage, and income potential. It is a good idea to confirm with your lender at least two weeks before closing to ensure everything is on track for final approval.

Association Approval

Some properties require approval from a homeowners or condominium association before closing. Be sure to review all rules, regulations, and required documents provided by the seller. Both parties will agree on a timeline for submitting applications or scheduling any necessary interviews. Once approved, the closing agent will obtain the official approval letter for recording at closing.

Property Insurance

Property insurance protects your investment from potential risks such as fire, theft, and certain weather events. While not always required by law, most lenders will require coverage as part of the loan process. Depending on how you plan to use the property, you may need homeowners insurance for a primary residence or landlord insurance for an investment property.