Escrow Inspection and Appraisal

To Buy


Choosing A
Real Estate

Time to Go

& Appraisals

Moving In

The Process, Step-by-Step

The Initial Offer and Deposit.

An offer to purchase, or Memorandum of Terms, together with a 1% deposit, is generally the first step in the home buying process here in New Canaan.  Unlike many parts of the country where the initial agreement constitutes a legal arrangement between a potential purchaser and the property’s seller, that is rarely the case here where contracts are customarily drawn by the seller’s attorney and then sent to the buyer’s attorney for review.

Some important tips to keep in mind to streamline the process:

  • Keep written records of everything. For the sake of clarity, it will be extremely useful to transcribe all verbal agreements and incorporate them into the Memorandum of Terms.
  • Schedule the Building Inspection as quickly as possible and within the agreed upon time frame.
  • Remember that until  contracts are signed by the buyer, then countersigned by the seller and delivered back to the buyer’s attorney, there is no binding legal agreement. 

The Closing Agent.  In Connecticut, closings are generally handled by attorneys who must be licensed in the State of Connecticut.  For both buyers and sellers it is advisable to select an attorney who is knowledgeable about town codes, ordinances and zoning requirements, and has the ability to handle any issues that might arise in the course of the transaction.  The deposit is held in escrow by the attorney who will also 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.

How to Hold Title. You may wish to consult an attorney or tax advisor on the best way to hold title. Different methods of holding title have different legal, estate and tax implications, especially when selling or upon death of the title holder.

Inspections. Once your offer is accepted by the seller, you will want to have a licensed property inspector inspect the property within the timeframe that was agreed upon in the effective contract to purchase. 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).  I can recommend numerous competent inspectors who are included in the list of resources on this site.

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

1. Either each milestone is successfully closed and the contingencies are removed, or…

2. The buyer, after reviewing the property inspection report and documentation, renogotiates terms of contract as necessary, resulting in a credit, repairs or price adjustment.

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. If the contract is contingent 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 specialists in determining the value of properties, based on a combination of square footage measurements, building costs, recent sales of comparable properties, operating income, etc.  Two weeks of prior to closing, double check with your lender to be sure the loan will go through smoothly and on time.

Association Approval. If the property that you are purchasing is contingent upon an association approval, request the rules, regulations, and other important documents from the seller as soon as you have a contract of sale. Make sure that the application documents and processing fees are submitted to the appropriate person at the association by the required time. Fill out all of the information completely and legibly so there is no delay in processing the application. If you are required to meet with the association for your approval, make an appointment as soon as possible for the interview. Most associations require a certificate of approval before move-in. Your attorney will request that the original copy of this approval letter be brought to the closing, so that it can be recorded with the deed in the county public records.

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 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.