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I’m Under Contract on My Dream Home – Now What?

Congratulations, you’re under contract! This is an exciting development along the path to homeownership, to be sure, but we’re still a few steps away from popping the cork on that bottle of champagne. 

While it may have been an adventure getting to this point and the end is definitely in sight, there are still several crucial steps to complete before you get handed the keys to your new home. 

Time is of the essence, as the typical contract-to-close process is 30 to 60 days, and there are some milestones to hit along the way. 

But never fear — here is a handy step-by-step guide to everything that happens between signing the contract and getting the keys to your dream home. 

Complete Your Mortgage

As soon as your offer is accepted, you should be in contact with your chosen mortgage lender to let them know your intent to proceed

You began the lender relationship with your pre-approval for a mortgage loan and perhaps even reviewed some likely closing costs. Once you’ve provided your lender with the nod, you’ll be asked for a formal intent to proceed and you’ll have to make an application deposit (this covers some of the lender’s “hard costs”, like performing an appraisal.) This deposit will be applied to your closing, so it isn’t additional cost, it’s just cost you pay right now. With 72 hours of starting this process (by law) you’ll receive a loan estimate with your projected monthly payment, closing costs, terms, and other associated fees. You’ll need to sign this document immediately. Your signature acknowledges receipt. Even if there are typographical errors, or some open questions, you should sign the document to reflect that you received it, and then share your questions or concerns with your loan officer. 

Your loan team may pick up a second point of contact here – their loan processor. Either your loan officer or your loan processor will let you know what other data they require from you and your real estate team to seal the deal, such as recent bank statements, paystubs, or some additional information related to the property (think: HOA documents.)

Money Matters

Around the same time, you deposit initial earnest money deposit, which will live in an escrow account belonging to the listing brokerage or the title company (do not give it directly to the seller). Your agent can direct you how to make out the check. Be sure to get a receipt!

It’s also time to schedule a home inspection. In Illinois, these firms must be certified by the Illinois Department of Financial and Professional Regulation. You can expect to pay $400 to $800 for a thorough inspection of the entire property, and it’s money well spent.

Your agent should be able to give you referrals to trusted and well-respected professionals they have worked with before, such as home inspectors, attorneys, insurance agents, handymen, and more. When in doubt, I have some excellent referral partners – just ask!

A real estate lawyer is a crucial part of your team. You should set up a consultation with them as soon as possible to discuss the services they’ll provide, such as contract and inspection report review, title searches, and negotiation. 

Known in Illinois as the Attorney Review Period, this (5-10 day period) gives you a chance to get invaluable expert advice before making one of the most major financial decisions of your life.

After your attorney has reviewed every aspect of the sale, you’ll want to go ahead and deposit the balance of earnest money in the escrow account, if you haven’t already. 

The Waiting Game

Now there’s a bit of hurry up and wait. Your lender will order an appraisal of the property to ensure that it’s worth at least as much as you’ve asked to borrow. Unseen wheels are in motion.

It’s the perfect time to start getting your household and belongings ready for a move. While this can be a very stressful event, there are plenty of lifehacks and tips online to help you. Declutter, make a checklist, make a packing strategy, and get estimates from movers now.

Beware of moving company scams, however, which are unfortunately becoming more common. The Better Business Bureau receives tens of thousands of complaints each year. Here are some red flags to watch out for:

  • Requesting large cash deposits
  • Offers instant online quotes instead of an onsite estimate
  • Not being registered with the Federal Motor Carrier Safety Administration (FMCSA)
  • Asking you to sign blank contracts or paperwork
  • Not providing a copy of “Your Rights and Responsibilities When You Move,” which is required by law

Always do your due diligence, read plenty of reviews, and get referrals from your real estate team. 

You should also look into switching your utilities and mail to your new address. You can do this with the USPS online and if you’re in the Chicagoland area, reach out to ComEd, City water and sanitation services, Peoples Gas, and Xfinity, Astound, or your preferred cable and internet provider.

Once the underwriting is complete and you’re fully approved, your lender will send you a loan commitment and then a closing disclosure document, three days before you’re due to sign the final paperwork at the closing table.

Consult with your real estate agent to schedule the final walkthrough. This is your last chance to give the property an exhaustive review before you close on the sale to make sure everything is as it was listed in the contract. 

Many experts suggest coming to the walkthrough prepared with the home inspection report, a phone and charger, your contract, and a checklist that includes steps such as:

  • Identifying repairs the seller was supposed to perform
  • Ensuring all doors and windows open, close, and lock properly
  • Inspecting the bathrooms and kitchen for stagnant water and mold
  • Testing appliances and electrical outlets
  • Turning on the heat and air conditioning (don’t turn on the air conditioning if the outdoor temperature is below 60, or has been cool for a few days in a row. You could damage the compressor.)
  • Walking the entire property
  • Looking for any signs of damage or pests

If everything is to your satisfaction and meets the conditions of your contract, it’s closing time

Welcome Home

Talk to anyone who’s purchased a piece of property and they’ll tell you that the day they finalized the sale was both thrilling and nerve wracking. This is unquestionably an emotional process.

It’s easy to feel overwhelmed, but congratulations really are in order. You and your family have done a lot of hard work to get to this point, and you should be proud!

The actual procedure doesn’t take long, and you will have already reviewed your closing disclosure documentation with your attorney. At the closing table, you’ll hand over your closing cost funds (you’ve probably already wired them), sign some papers, and your lender will wire over the mortgage funds. Once that’s done, you’ll have those keys in your hand and you can truly celebrate your accomplishment.

If you’re ready to embark on the journey to home ownership, I can help, every step of the way. Give me a call today to see how I can make your real estate dreams a reality.


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