InÂ Part 1 of theÂ Las Vegas First Time Home Buyer Guide, I stressed the importance of shopping your financing options and getting approved for a loan. Â Once buyers are qualified they are usually excited to go shopping but they need to make sure they are ready to buy before they waste any time looking around.
In Part 2, we explored when it would be a good time to go shopping for your first home.
In Part 4, realistic time frames for purchasing a home in a distressed environment were set.
In Part 5, Â we discussed the home search.
In Part 6, we wrote our offer.
Congratulations & :golf clap:! Â We finally have an accepted offer!
NOW WHAT do we do? Â It depends on the type of sale with the accepted contract! Â There are four major types of sales in our market now
Standard Sales & Trustee Sale Flips: typically you would execute the contract in a more “normal” (what’s that?) fashion by signing off on the offer and counters and then open escrow with the earnest money deposit as instructed in the contract. Â Escrow & Due Diligence begins.
Other types of sales it gets a little confusing!
REO or Bank Owned: This is where detailed instructions are sent out. Â Usually a “Bank Addendum” needs to be executed prior to full offer acceptance. Â This is where they rewrite the contract in their favor. Â If you don’t accept the terms & conditions set forth in the bank addendum – you more than likely won’t get the house. Â This is usually written in the “bank’s favor” and should be submitted to your attorney of choice for review. Â Once all of this is completed, you will be able to open escrow with your earnest money deposit. Â The seller picks title & escrow company in most cases. Â If you, as a buyer, choose to pick title, you more than likely will have to pay the seller’s title costs. Â Many REO title company preferences are located out of town and require EMD to be deposited in the form of certified funds (cashier’s check or money order). Â Escrow & Due Diligence begins.
Short Sale: These are executed in a similar fashion to standard sales. Â HOWEVER, there is a seller contingency that they need third party approval. Â You will still need to deposit your earnest money to escrow per terms and conditions of your contract. BUT (don’t you love but’s?) I make sure a short sale addendum gets approved so your due diligence won’t begin until all lienholders approve the seller’s short sale and the seller agrees to all terms & conditions in the short sale approval letter. Â So now the game of “hurry up and wait” begins with the short sale! Â Short sales can take anywhere from a couple of weeks to a couple of years (you read years right!) for that contingency to be approved!!
In the next couple of posts in this series I will be discussing due diligence & time frames and the escrow period. Â Stay Tuned!
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