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Susan McFarland

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Inspections and Appraisals

The Process, Step-by-Step

The 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:

  • I will provide you with written records of everything. For the sake of clarity, I will ask you several questions to complete the purchase agreement. Electronic signatures are common, legal, and standard operating procedure in todays real estate market.
  • Stick to the schedule. Now that you have chosen your offer, you and the seller will be given a timeline to mark every stage in the process of closing the real estate contract. Meeting the requirements on time ensures a smoother flow of negotiations so that each party involved is not in breach of their agreements. During the process I will keep you constantly updated, so you will always be prepared for the next step.

The Closing Agent.

A title company will be selected as a closing agent. The listing office will hold the deposit in escrow and the title company will research the complete recorded history of the property to ensure that the title is free and clear of encumbrances by the date of closing and that all new encumbrances are properly added to the title. Some properties are subject to restrictions which limit various activities such as building or parking restrictions. There may be recorded easements and encroachments, which limit the rights to use your property.


Once your offer is accepted by the seller, you will need to have a licensed property inspector inspect the property within the time frame that was agreed upon in the contract to purchase. I will assist you with this. You may elect to have different inspectors inspect the property, if you wish to obtain professional opinions from inspectors who specialize in a specific area (eg. roof, HVAC, structure). Other environmental tests including radon, mold, well and septic, and water inspections can be done as well.

Depending on the outcome of these inspections, one of two things may happen:

1. After inspections are successfully complete, with satisfactory results, the contingencies will be removed. This brings you one step closer to the close, OR

2. You can, after reviewing the property inspection report can request a renegotiation of the terms of the contract,( usually the price), you can also, within the time frame agreed upon, void the contract. Your earnest money deposit will be returned to you in full, if that is your decision.

Appraisal and Lending.

It is imperative that you keep in close communication with your lender, who will let you know when additional documents are needed to approve your loan application and fund your loan. I will also be in communication with your lender on a weekly basis. If the agreement is conditional upon financing, then the property will be appraised by a licensed appraiser to determine the value for the lending institution, via a third party. This is done so that the lending institution can confirm their investment in your property is accurate. Appraisers are hired by lending institutions to determine the value of properties, based on a combination of square footage, condition, location, and recent area comparable.

Homeowners Association Document .

During the inspection period, you have the right to request and review the home owners association rules, and regulations.

Property Insurance.

If you are obtaining a loan, you will be required by your lender to purchase a certain amount of insurance on the property. The value will depend on the lending institution and the purchase price of the property. You may be able to save hundreds of dollars a year on homeowners insurance by shopping around for insurance. You can also save money with these tips.

  • Consider a higher deductible. Increasing your deductible by just a few hundred dollars can make a big difference in your premium.
  • Ask your insurance agent about discounts. You may be able to get a lower premium if your home has safety features such as dead-bolt locks, smoke detectors, an alarm system, storm shutters or fire-retardant roofing materials. Persons over 55 years of age or long-term customers may also be offered discounts.
  • Insure your house NOT the land under it. After a disaster, the land is still there. If you do not subtract the value of the land when deciding how much homeowner’s insurance to buy, you will pay more than you should.
  • I will be happy to recommend experienced knowledgeable insurance agents for every property type.