Buyers Under-Contract Transaction Process
We often get questions from out-of-state and international buyers who want to know how the offer and sales process works here in Utah. As your Buyer's Agent we work for you, and will carefully guide you throughout the process. Below is a brief summary of what to expect:
We write your offer on a state approved form, the "Real Estate Purchase Contract", commonly referred to as the "REPC". Along with an offer, we are required to also fill out and sign a "Buyers Due Diligence Checklist" and "Buyer-Broker Agreement & Agency Disclosure". We prepare the REPC, based on your instructions, after we discuss the various options. Once all is prepared we'll send the forms to you via DocuSign, so can easily sign digitally. We then submit the offer to the Seller or Seller's agent.
After negotiations, once your offer is accepted by the Seller (or once you accept the Seller's counteroffer) you are then officially “Under Contract” (In-Escrow). Once under contract, you must deliver your Earnest Money Deposit within 4 calendar days (usually by wire). The Earnest Money is held at our Summit Sotheby's brokerage trust account or it can also be held at a title company. As the Buyer, you will usually have a Due Diligence time period (about 2 weeks is common). If you cancel the contract during your Due Diligence time period you get your full earnest money back. You can cancel for any reason or no reason at all, pretty simple - but written cancellation must be before the due diligence time period ends. If you cancel after the Due Diligence deadline date, the Seller may keep your Earnest Money deposit, so we watch this date closely.
Although under contract for sale, we still have much work to do to ensure a successful closing. Many of these steps will have strict deadline dates applied, and if not completed properly and on time, could cause forfeiture of your earnest money and loss of the sale. Below is an outline for the steps to expect. Remember, we will be your guide through the entire process. Its our job to keep you updated, informed, protect your Earnest Money and make the process as easy and smooth as possible.
Remember, we are your Buyer's Agent. We represent YOU. We are here to work for you, and look out for your best interests, so when we communicate with you, please communicate back promptly with us.
This is the date that the seller or the buyer accepts the offer, or last counter-offer, hereby placing the property under contract. Many dates throughout the transaction process may be based on the "Acceptance Date".
Earnest Money to be Deposited
You as the Buyer may turn in Earnest Money with your offer, but more often the Earnest Money will be due within "4 calendar days upon acceptance" as stated in the Real Estate Purchase Contract (REPC). The Earnest Money is normally deposited with the Buyer's real estate brokerage, to be held in a real estate trust account until closing.
Receive the Seller's Disclosures
This is the process where the Seller is required to provide you the Buyer information relating to the property. The Seller will be providing the following information. This is usually completed within 1 week from the Contract Acceptance Date.
- Seller's Property Condition Disclosure - filled out form, signed and dated from Seller.
- Commitment for the policy of Title Insurance, showing any easements, encroachments and liens.
- HOA information, budget, minutes, assessments, CC&R's, and survey, water rights if applicable.
- Copy of any leases, rental, and property management affecting the property not expiring prior to closing.
- Notice of any claims and/or conditions relating to environmental problems & building or zoning code violations.
- Inventory of Included Personal Property, if any.
Schedule Your Home Inspection
During your due diligence timeframe, we'll assist you in scheduling a home inspection. We typically do not attend the entire inspection, but we usually do meet the inspector at the end to have the opportunity to discuss any major concerns and visually see them together. We then get a full detailed inspection report with photos of the concerns and issues. This is usually completed within 1 week from the Contract Acceptance Date.
Your Buyer's Due Diligence (Evaluations and Inspections)
This is the time period provided to you as the Buyer to learn, review, and inspect the property and decide if its condition is acceptable. This is usually completed within 2-3 weeks from the Contract Acceptance Date.
- Carefully review all items provided in the Seller's Disclosures.
- Schedule any physical condition inspections, tests and evaluations deemed necessary.
- Verify the ability to do nightly rentals if important.
- Review the costs, terms and availability of homeowner's insurance for the property.
Your Right to Cancel or Resolve Objections
This must be completed within your Buyer Due Diligence time period!
(If you want to get your Earnest Money back)
If you determine from your Evaluations and Inspections that the physical, title, or legal conditions of the property are unacceptable, you may:
- No later than the Due Diligence Deadline, cancel the contract by written notice to Seller.
- Or no later than the Due Diligence Deadline, resolve in writing any objections.
Financing, Appraisal and Any Remaining Contingencies
In the final steps of the transaction we will coordinate and complete any remaining details. This is the last date where you can still cancel the contract (based only on financing/appraisal issues) and still get your earnest money back. This is usually completed within 30-40 days from the Contract Acceptance Date.
- Is the sale and/or mortgage contingent upon an appraisal?
- At what amount did the property appraise?
- How is your financing going? Is the new loan fully approved and ready to pull docs?
- Are there any last minute issues for securing your mortgage?
- Is the sale contingent upon you selling your previous home? How is that sale going?
- Schedule a final pre-settlement walk-through inspection.
At this point, if everything is looking good and we are on track to go to closing, its now time to get the utilities transferred to your name. The Title Company usually will transfer water and sewer, but you will need to set up electric, gas, phone, cable/satellite, internet (unless these items are provided by the HOA). We have contact info for all utility companies on our Utilities Page.
You can complete your side of Settlement from your home state, or overseas. The documents can be delivered to you via FedEx, email or DocuSign, or we can often set up a mobile notary. You will need to deliver original notarized copies (if using financing) or if this is a cash sale, DocuSign may be sufficient. We help coordinate these details with the Title Company that is handling the transaction. In Utah, all closings are performed by title companies. Buyers are often confused by "Settlement" and "Closing." Settlement shall take place only when all of the following occur:
- Buyer and Seller sign all documents required by REPC, Title, Lender, etc.
- Any monies required to be paid by Buyer and/or Seller, have been delivered.
Once both sides complete their obligations by the Settlement Deadline, the actual "Closing" can take place. These steps can be completed on the same day as Settlement, but most often it is a day after. Depending on the day and time of Settlement, the next steps can be as much as a couple days after (if taking place over a weekend or holiday). Important Note: The day that you sign the "closing" documents, you likely will not receive keys that same day, especially if the purchase involves financing. Once you sign, the documents go back to the lender for approval, and then the lender sends the mortgage funds. Once the Title Company receives the funds, they can then record the sale. This is usually completed within 1-2 days after Settlement.
- The proceeds of the new loan are "funded" by the mortgage provider.
- Then all closing documents are "recorded" at the County Recorders office.
- Once recorded, the sale is complete and the buyer gets Possession (unless stated otherwise).
- The Buyer can receive keys, garage door openers, manuals, warranties.
The property is now yours, so move on in and enjoy, Congrats!
When buying a home in Park City or Deer Valley — whether it's your first purchase, second home, or a getaway vacation condo — you're bound to have many questions. Our website offers a wealth of information about the home finding and buying process. Feel free to give us a call anytime, we are always around and look forward to hearing from you!
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