Things you should know (buyer's FAQs)

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An EMD is a sign of good faith to the seller to let them know that you’re serious and committed to purchasing their home.  The EMD will typically be collected by your buyer’s agent’s office and will be held until closing.  At that time it will be applied toward your funds due at closing. 

A title company is responsible for verifying that the title to the home is free & clear of any liens when a home is sold.  They handle all of the payoffs and liens against the property.  They also issue what’s called title insurance.  Last, they verify that all documents are prepared and signed correctly at closing and disburse all of the funds that are collected during the closing process. 

This type of offer is called a contingent offer.  It means that your offer is contingent on something else happening.  Typical contingencies are inspection contingencies and mortgage contingencies.  However, there can be any sort of contingency that you can think of.  In the scenario where a buyer needs to sell their house it needs to be clearly stated in the purchase contract that this needs to happen.  Often in a hot market a contingent offer isn’t always the strongest offer.  However, nothing should be considered impossible.  It’s best to consult with your real estate agent to find out the best way to frame an offer that is contingent on the sale of your home. 

In some cases a seller will need to remain in the home after you have signed all of your documents and you are the official owner.  This is known as Occupancy.  Within the purchase agreement there will be a set time period that the seller will be allowed to occupy the home after closing.  There will also be an agreed upon price for that time period.  Although it’s not as exciting, it can be a common part of a real estate transaction. 

It’s very likely that the property taxes on your new home will increase after you purchase it.  However, this is all dependent on the current taxable and state equalized value of the home you are purchasing.  It is also dependent on what you are purchasing it for.  Definitely consult with your loan officer and real estate agent to determine what your monthly mortgage payment could increase to in the event that your property taxes go up. 

Lenders want to make sure that property taxes are paid on time and don’t become a lien against your property/home.  They also want to make sure that your home is insured in the event of a total loss.  To make sure these items are paid, they administer an escrow account for these items.  It’s basically a savings account that they hold on your behalf.  You make the tax & insurance payments on a monthly basis to the lender.  The cities or townships and insurance companies send them the annual bills to pay when they come due. 

We understand that our list of buyer's FAQs isn't comprehensive.  If you have a question about a specific part of the homebuying process, please submit it to us and we'll make sure to get you an answer.  We may even add it to our list.