First-time Home Buyers: What Happens After The Offer?

We often hear first-time home buyers ask: What happens after the offer? Learn what happens next from a Santa Clarita real estate expert.

The first-time home buyer experience is one you’ll remember for the rest of your life. It can be exciting, nerve-wracking and incredibly complex, all at the same time. 

But there’s nothing to be afraid of – as long as you have the right team of professionals supporting you throughout the journey. 

“Believe it or not, purchasing a home is extremely complicated, even though people do it all the time,” explained Steffanie Stelnick, Founding Partner of The Law Office of Steffanie Stelnick. “We know this, and that’s why we’re here to help you navigate each step with success.”

First-time Home Buyers & The Current Market

Despite a turbulent 18 months, more and more first-time home buyers have been entering the market with each passing month. Interest rates are low and inventory is tight, which means buyers are competing for their best shot at entering the market. 

In 2020, 2.38 million Americans became first-time homebuyers – a figure 14% higher than pre-pandemic numbers in 2019. And last summer, the National Association of Realtors reported that more than one-third (35%) of all home purchases were made by first-time buyers.

Buying a home can be a complicated purchase, especially for first-time homebuyers. The good news is: Your experts at The Law Office of Steffanie Stelnick are here to guide you through the entire process. 

If you’re ready to make an offer on a home in Santa Clarita or throughout California, then let us ensure your biggest investment is a sound one.

So You Made an Offer – Now What?

“If you submit an offer for a home in Santa Clarita – and the seller accepts your offer – that means you’re now under contract,” explained Steffanie, who is the American Institute of Trial Lawyers’ 2020 Litigator of the Year Litigator of the Year. “You have officially started the escrow phase of your home purchase.”

(Need to brush up on your understanding of escrow? Learn the basics of this crucial phase here.)

When you’re under contract, the buyer is typically given the standard 17 days to complete all buyer investigations.

“You can change the date, but my advice is to always stick with 17 days because you need as much time as possible to find out what’s really going on with the property you’re purchasing,” Steffanie explained.

The Earnest Money Deposit

Once you’re under contract, there are certain contingencies you have to follow as the buyer, if you want the sale to become final. 

One of the first steps is to put money in an account known as an earnest money deposit, which is considered to be a show of good faith for the seller. 

There’s no standard amount – it varies with the realtor – but it’s typically 1% to 3% percent of the home purchase price. That means, if a buyer’s offer is $500,000, the initial deposit might be somewhere between $5,000 and $15,000.

The Home Buyer Investigation

Buying a property is one of the largest investments you’re likely to make, and that’s why it’s critical to make sure you, as the buyer, are aware of any needed and future repairs and maintenance.

“During the buyer investigation, you have to find out what’s wrong – or hopefully not wrong – with the home you’re purchasing,” Steffanie explained. “This is the phase when you really have to go above and beyond, and do what you have to do, because it’s on you to make sure every possible problem is discovered during the buyer investigation.”

This process requires a qualified and experienced home inspector, which means they are appropriately trained, maintain proper insurance, and can provide a qualified and impartial opinion. 

Reach out to The Law Offices of Steffanie Stelnick for a referral to a trusted home inspector.

What’s Next? Pending Contract

Once the 17-day period is over, the buyer transitions from under contract to pending, which means the buyer has now waived their contingencies. Everything is good to go, and you’re ready to close escrow.

During this time, you can still back out of an offer after you’ve waived your contingencies; however, you’ll likely lose your earnest money deposit, unless the seller fails to deliver the property in the condition promised. Losing that earnest money deposit can cause some serious damage. 

“That’s why it’s so important to understand the escrow process and follow through with your buyer duties in a timely manner,” Steffanie explained. “Otherwise, you risk losing all that money.” 

Still have questions? Learn more about contract statuses in this video with Steffanie:

How We Can Help

Real Estate Attorney Steffanie Stelnick represents businesses and individuals in real estate disputes across Southern California. Ms. Stelnick is a California native who has dedicated her practice to serving those involved in real estate transactions and litigation. California property law is complex, requiring an intricate knowledge of statutes, contracts, and lease agreements. Ms. Stelnick is an experienced negotiator who fights hard to protect her clients’ rights and interests.

If you need someone to review your contract, or help you navigate the first-time home buyer process, Ms. Stelnick offers a complimentary case evaluation and an extensive background in Santa Clarita real estate law.