Are you nervous about making an offer on a new home due to being locked into making a very expensive purchase? If so, know that there are actually several points in the home buying process where you are able to walk away. Here is how you can get your earnest money back if you discover that the home is not for you.
After Getting the Inspection
One of the first things you do after making an offer on a home is to have a home inspection performed. You will pay for an inspector to go through the home with a fine tooth comb, making sure to identify all potential problems with the home that they find. You'll then get a detailed report indicating what things can be potential problems. You can use this report to justify backing away from the home if necessary. You can say that there are too many things that need to be repaired, or that you are discovering things that you didn't know about.
After the Appraisal
Another part of the home buying process will involve having an appraiser tell you how much the property is worth. The problem with an appraisal is that it can report that the home is worth far less than what you think it's worth. This can cause problems with securing financing, because it will be tough to get a mortgage that is for more money than the appraised value of the home. That's why you can use the appraisal as a way to get out of the purchase.
After the Title Search
You'll need to have a title search company dig up information on the home's title before you sign all the paperwork. This ensures that the home you are buying can legally become yours, and that there are no existing claims on the home that can cause problems for you. If something does come up, such as a lawsuit where there is a lien on the home, you can back out of the sale.
After Losing Financing
It is a good idea to have a contingency that allows you to back out of a home purchase if you ever were to lose your financing. This helps ensure that you get your earnest money back if you are unable to find a lender to give you the funds to purchase the home. Being declined for a mortgage can be for any reason, which includes failing due to your credit history or losing your employment before the sale is final.Share
23 January 2020
About a year ago, I realized that there were some serious issues with our home. I could tell that we needed to do something to upgrade our residence, so we started looking for a different property. I was able to find a really nice real estate agent who could help, and they worked hard to pair us with the perfect home for our budget and lifestyle. Now I can honestly say that I love my home, and I couldn't have chosen a better one on my own. Check out this blog for great information on improving real estate holdings and finding a better home.