We look forward to assisting you in the purchase of your home. Please do not hesitate to contact a member of our team should you have any questions or concerns throughout this process.
Below are explanations of some common terms you will likely encounter in the buying process:
EARNEST MONEY DEPOSIT
While you are not legally required to make an earnest money deposit, it is customary in/around the Charlottesville area. The deposit amount, which is not a set amount, is typically due within 5 days of ratification. The purchaser’s brokerage, again, typically holds the deposit until settlement, at which point the funds are release to the purchaser’s closing agent who then contributes that amount towards the sale. If for some reason the transaction does not reach a successful closing, the seller may have the right to go after the deposit (and potentially more in some cases), but it should not be assumed that seller has an immediate right to the money, as is often the misconception.
A home inspection (or most any inspection) of the property typically occurs after the purchaser and seller have agreed to all terms of the contract. The home inspection is bound by a set of terms that are defined in an addendum to the purchase contract. A home inspector evaluates the structural and mechanical components of the property, and provides a written report including concerns and recommendations. The agent can help the purchaser to select and schedule the home inspection within the allotted time per the contract. Typically home inspections can take anywhere from 2-4 hours and the purchasers are encouraged to attend, but attendance is not mandatory for anyone except the purchaser’s agent. The reports are usually available the same day or following day and the cost of the inspection and report starts around $300, but can climb much higher depending on the size of the house and extent of time/effort required by the inspector. The fee is due at the time of inspection. These inspections typically do not include well, septic, termite, specialty items (pools, hot tubs, etc.) or hazardous materials (radon, lead paint, asbestos, mold, etc.), but the purchaser has the right to order separate inspections as allowed by the terms of the contract. In Virginia, with only a few exceptions, the seller is required to provide the purchaser with a termite (pest) inspection/report, and well and septic report if applicable.
Home Inspector Recommendations:
Building Analysts | David Kariel | Work 434.295.3483 | Home 434.293.4158 | Fax 434.923.3540
Cavalier Home Inspection | Jim Quinsberry | 434.906.2303
Cornerstone Home Inspection Services | Jay Coleman | 434.962.1585
Alexander Nicholson, Inc. | Martin Quarles | Work 434.296.7526 | Mobile 434.960.3656
Joel Loving | Hazardous materials only | Work 434.977.1409 | Pager 434.979.6788
Gannon Home Inspections | Jim Gannon | Home 434.263.6521 | 434.996.4401 | Fax 434.263.6891
“Formal” (not just speaking with your lender) loan application is due within 5 days of all parties signing the contract. The “lender” loan officer represents a mortgage company in assembling all pertinent information about the purchaser in order to meet government/company guidelines concerning mortgage lending. The processor works with the Loan Officer in preparing the loan packet and sending it to the Underwriter. The Underwriter confirms that the loan meets all applicable guidelines and approves or rejects the loan. Purchasers should have frequent contact with the Loan Officer and sometimes even the Processor during the application process, but typically do not have direct contact with the Underwriter. The Lender is paid from the Loan Origination Fee that appears as part of the Closing Costs. An appraisal is an opinion of value that is completed by a professional appraiser who visits and inspects the size, condition, function and quality of the home. It is ordered by the lender within a few days of the date you apply for your loan.
Presidential Mortgage| Tom Scully | 434.293.6430 | firstname.lastname@example.org
Mahone Mortgage | Tom Mahone or Kim Casteen | 434.293.5200 | www.mahonemortgage.com
Crown Mortgage| Michael Martin | 434.975.5626 | Michael@email@example.com
The Insurance Agent represents the Insurance Company in writing a Hazard Insurance policy for the property. The Policy binder is sent to the Attorney prior to closing to satisfy Lender requirements. What the Policy covers is identified specifically in the policy which is sent to the Purchaser. The policy may be paid for in advance of closing or at closing as part of the closing costs. Cost range from $2.50 to $3.50 per thousand of the value of the property (excluding the land) depending on the age, location, type of construction, and overall features of the home.
Piedmont Insurance | Beth Heck | 434.220.5650
Nationwide Insurance | Ray Hogan | 434.973.9115
Hanckel Citizens | Joe Jenkins | 434.296.7191
State Farm| Gary Albert | 434.296.1222
Either an attorney or settlement company is selected to handle the closing. The purchaser has a right to select their own closing agent in Virginia. An attorney will represent the purchaser in reviewing all documents, coordinating closing with the lender and Seller’s Attorney, Title and Hazard Insurance Companies, ordering the survey, and recording the sale at the Clerk’s office. A purchaser should anticipate very little contact with the attorney until a couple of weeks prior to closing. Costs vary, but start around $450 plus Fed Ex, Fax and miscellaneous charges. An alternative to using an attorney is a settlement company. In this situation the Purchaser has no legal representation (it is rarely needed) and the benefit is a slight ($150.00 or so) cost savings. We are happy to make recommendations as to which avenue you should pursue, based on the variables in your transaction!
Lenhart Pettit | Page Williams | 434.979.1400 | Fax 434.977.5109 (Attorney)
Marshall & Marshall | Bill Marshall | 434.295.7113 (Attorney)
Zunka, Milnor, & Carter | Rick Carter | 434.977.0191 | Fax 434.977.0198 (Attorney)
Court Square Title | 434.979.7799 | Fax 434.979.8819 (Settlement Company)
Charlottesville Settlement Company | 434-817-0400 (Settlement Company)
Sometimes a seller will provide a home warranty, but if not the purchaser may also consider purchasing one at settlement. A home warranty can be tailored (to an extent) to fit certain needs/budget. We typically recommend American Home Shield www.ahs.com
If the seller does not have a physical survey to provide, the purchaser may want to consider a survey before closing. Again, we can help with this decision. A lender may even require one as part of loan or title requirements. An attorney or title company should talk about this more in depth and take care of ordering.
IF, of course, you have any questions regarding other terms in the contract or through the transaction, we are always happy to provide explanations.
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We will only recommend products or services that we and/or our colleagues at Montague, Miller & Co. Realtors believe are genuinely helpful. We do not accept payment or referral fees for recommendations. Our recommendations are only suggestions of third-party products or services. These recommendations do not come with a guarantee or warranty of any kind.