What to do after your home offer is accepted

If you’ve made an offer on a house and there are strong signs your offer will be accepted, it’s time to start making a plan for after you get the official green light. Although it can feel like the offer acceptance is the end of a long and complicated house hunting journey, there’s quite a bit left to do on the road to homeownership after making a successful offer.

From home appraisals and inspections to depositing earnest money and closing, let’s break the journey down so you can get through it confidently and stress-free.

11 things to do once a seller accepts your offer on a house

Now that your offer has been accepted, it’s time to create a checklist that will both streamline the process and ensure you don’t forget anything important. Here are some major steps you can expect.

1. Deposit earnest money

Depositing earnest money – typically 1% – 3% of the sale price, but sometimes more – into an escrow account is one of the first things you’ll need to do in most states. This lets the seller know that you’re serious about going through with the sale. And don’t worry; this money will go toward your closing costs or down payment.

Make sure your purchase agreement includes an inspection contingency, however. With this, if your home inspection turns up significant problems with the home that result in you wanting to back out, you’ll get your earnest money back. Without an inspection contingency the seller may not be legally obligated to return your deposit.

Pay the seller a due diligence fee (if applicable)

In some states, such as North Carolina and South Carolina, you may also have to pay a due diligence fee. This is a smaller fee – ranging from 0.01% to 0.05% of the home’s purchase price – but it’s nonrefundable. It gives you the right to access the property for inspections, checking zoning, and other needed preparations.

2. Secure a home loan

It’s ideal to be preapproved before you submit an offer, but if you skipped that step, it’s best to start working on securing a home loan immediately. Be sure to let your lender know the property’s address so they can generate documents tailored to it.

Rocket Mortgage® has helped millions with their loan approvals, so this is a good time to contact us. And if you’re wondering if you can switch lenders after the offer is accepted, the answer is yes. You aren’t obligated. You can change lenders right up until closing if you find a better rate and terms.

3. Have the home inspected

A home inspection is a must-do; the last thing you want is to move into your new dream home and discover an aging water heater or terrible plumbing that will turn it into a nightmarish money pit. You, the buyer, are responsible for paying for the home inspection, and it will typically average about $350, but this is money well spent.

Here’s a checklist of some of the important things a home inspection will assess:

• Home’s foundation
• Doors and windows
• Plumbing
• Sink and shower fixtures
• Signs of water damage
• HVAC
• Roof
• Gutters
• Exterior siding

4. Have the home appraised

Your lender will also want an appraisal to approve your loan. This is different from a home inspection. An appraisal provides a fair market value of the home, based on comparable homes and sales in the area.

If the appraisal comes in lower than your offer amount, your lender is unlikely to approve your loan. For instance, if you offered $500,000 and the appraisal comes in at $470,000, you might have to make up the difference in cash.

5. Review the title

It’s important to make sure the title is clear before buying the home. A clear title means that there are no legal claims, such as liens or ownership disputes, that could encumber your ability to live in or sell the home later.

The title tells you who owns the home and who has a right to live there. Your lender will likely insist on title insurance, which covers you in case something is missed during the title search.

6. Obtain homeowners insurance

Your lender will also probably require proof of homeowners insurance before you can close on your loan. Even if they don’t, this is a smart way to protect yourself from loss. Homeowners insurance policies typically protect your home – the actual dwelling – your personal property, and provide liability coverage (in case someone gets hurt on your property).

Depending on the area in which you’re buying a property, you might also need to purchase additional coverage for things not included in every policy – a rider for floods or earthquakes, for example.

7. Complete a final walk-through

The final walk-through is a chance to make sure that everything you and the seller agreed upon regarding the included items and condition of the home is correct. Did they make the agreed-upon repairs? Did they remove any appliances that are supposed to be included in the sale?

Here’s a final walk-through list of common things to check:

• Turn on all appliances.
• Check for repairs.
• Check that all doors, windows, and locks work.
• Check that the electrical outlets and switches work.
• Check the outdoor areas for problems.
• Check for pests.

8. Schedule home repairs

If you’ve agreed to pay for some of the repairs as part of the sale, this is a good time to schedule them. But schedule them to be done after closing – many a deal has fallen through at the last minute.

If the seller has agreed to pay for certain repairs, make sure those are scheduled and done for before closing. You lose a lot of leverage once the deal is closed.

9. Schedule your closing

On average, it takes 30 – 60 days from the date your offer is accepted to closing on a house. It could be sooner if the seller is very motivated or you are preapproved since mortgage approval is typically the longest portion of escrow.

10. Close on your new home

Here it is, the day you’ve been waiting for: closing!

Closing is a packed day, when you’ll sign a lot of documents, many of which must be notarized, escrow funds are transferred, and the fun part, of course: you get the keys to your new home. After closing, the escrow company will file the sale with the local authorities and you become the official owner.

11. Transfer the utilities

Once you close on your new property, it’s time to transfer all utilities into your name. Don’t jump the gun on this, however. Like scheduling repairs, it’s wise to wait until closing is finished in case there’s any delay or hiccup in the deal.

Common problems to prepare for

With an item as big and complicated as a home, problems can arise. So, don’t be too shocked if issues arise after your offer is accepted. This is what the escrow period is for: to iron out any wrinkles or give you a chance to rethink your interest.

Potentially serious issues with the home

Not every problem is a major one. These are some that might be:

• Mold or mildew issues. This is something that can cost a few hundred or several thousands of dollars to remedy.
• Foundation cracks or settling. Here’s another issue that can be relatively inexpensive to tens of thousands.
• Unpermitted additions. This can lead to insurance coverage, resale, and even legal problems.
• Patchwork plumbing or electrical. Again, these can be minor, but they can also be bank-breaking.

An appraisal that comes in low

Another common speed bump on the road to closing is an appraisal that comes in under your offer amount. If this happens, you have a several options     : You can walk away from the deal, renegotiate the deal, ask for a second appraisal, or pay the difference between the purchase price and the appraisal.

Here’s an example of the last option: If your offer is for $400,000 and the appraisal comes in at $370,000, but you still want the home, you can pay the $30,000 difference. This is true even if you have an FHA loan and planned to put down 3.5%.

This is why it’s important to keep an open mind and some flexibility through the escrow process. It will save you a lot of stress.

The bottom line: Know what to do after a home offer is accepted

Once your offer is accepted, it’s the beginning of an action-packed journey on the road to closing. But it’s important to complete each leg with care and attention to protect yourself and ensure your new home is the dream you envision.

Preapproval can make your offers more appealing to buyers, and your escrow smoother and faster. Fortunately, Rocket Mortgage^® offers a convenient preapproval process so you can house hunt stress-free.