Whether you’re a first-time homebuyer or an experienced seller, understanding the timelines and terms outlined in Sec. 3 of Colorado’s Contract to Buy and Sell is crucial for a smooth and successful transaction. At Dempsey Group, you will receive a weekly Monday update email that outlines the week’s to-do’s that will keep your deal on track. In this blog, we break down the key contract deadlines and definitions to make associated actions, providing you with the information you need to confidently get to the closing table.
Important Contract Deadlines and Definitions
Initial Negotiations
Acceptance Deadline Date and Time: The deadline the seller has to either accept the offer or counter the offer. If no action is taken, the offer expires.
Earnest Money Deadline: The buyer is responsible for delivering earnest money to the title company via a personal check, wire, or, sometimes, using an app. Earnest money must be liquid funds and it is typically dropped off within three business days of going under contract. You may see ‘MEC’ in the chart – this means mutually executed contract and it’s the date the contract is formalized by both parties.
Disclosures
Seller’s Property Disclosure Deadline: Seller’s deadline to provide known information to the Buyer for their review. It is typically due with the first two days of going under contract.
Lead-Based Paint Disclosure Deadline: Seller’s deadline to provide a lead disclosure to the Buyer to review, which is typically provided within the first two days of going under contract. This disclosure if required for all homes built prior to 1978. Read about lead in homes in this Environmental Protection Agency (EPA) flyer.
Lead-Based Paint Termination Deadline: The buyer’s deadline to terminate due to Lead Based Paint concerns. If this deadline is applicable, it normally aligns with the Inspection Termination deadline.
Due Diligence Documents Delivery Deadline: Seller’s deadline to provide requested disclosures to Buyer to review. Documents may include repair invoices, insurance claims, solar documents, and any other document related to the property that is in the seller’s possession. If this deadline is applicable, it normally aligns with the Seller’s Property Disclosure deadline.
Due Diligence Documents Objection Deadline: The buyer’s deadline to object to due diligence documents provided. If this deadline is applicable, it normally aligns with the Inspection Objection deadline.
Due Diligence Documents Resolution Deadline: Buyer and seller’s deadline to either come to a resolution on Due Diligence documents or the buyer’s deadline to terminate due to the documents provided. If this deadline is applicable, it normally aligns with the Inspection Termination deadline.
Title
Record Title and Tax Certificate Deadline: Title Company provides the Title Commitment and Tax Certificate to Buyer and Seller for review. It is typically delivered within seven days of going under contract.
Off-Record Title Deadline: Seller provides Buyer any additional title information that is not of public record. It typically aligns with the Record Title and Tax Certificate Deadline.
Off-Record Title Objection and Record Title Objection Deadlines: Buyer’s deadline to object due to title concerns, which happens within 2-3 days after the title documents delivery deadline.
Title Resolution Deadline: Buyer and seller’s deadline to come to a resolution regarding title concerns or the buyer’s deadline to terminate due to these concerns. It’s normally the day after the Title Objection Deadline.
Loan
New Loan Application Deadline: Buyer’s deadline to obtain a pre-approval letter. Most buyers already have their preapproval letter prior to submitting an offer.
New Loan Terms Deadline: Buyer’s deadline to terminate due to unacceptable loan terms such as interest rates, conditions, costs and payments. This is a subjective deadline that normally occurs within the first five business days after going under contract.
New Loan Availability Deadline: Buyer’s deadline to receive final loan approval from Lender. The lender must deliver, and Buyer must sign, a Closing Disclosure (CD) at least 72 business hours prior to the closing date in order to close on time.
Inspection
Inspection Termination: Buyer’s deadline to terminate without submitting an objection to Seller. The buyer’s inspection period is typically done within the first seven days of going under contract. This is a subjective Buyer deadline.
Inspection Objection: Buyer’s deadline to deliver an Inspection Objection notice to the Seller, which is normally within the first seven days of going under contract.
Inspection Resolution: Seller delivers inspection response to Buyer’s objections. If Buyer and Seller cannot come to terms, Buyer reserves the right to terminate and receive their earnest money back.
Insurance
Property Insurance Termination Deadline: Buyer’s deadline to find acceptable home insurance and provide info to Lender. It typically aligns with the Inspection Resolution deadline. This is a subjective Buyer deadline.
HOA
Association (HOA) Documents Deadline: Title Company’s deadline to provide Association documents to Buyer and Seller for review. HOA docs are normally delivered within the first seven days of going under contract.
Association (HOA) Documents Termination Deadline: Buyer’s deadline to terminate due to Association documents and traditionally falls five days after the HOA documents deadline. This is a subjective Buyer deadline.
Appraisal
Appraisal Deadline: Buyer’s deadline to receive an appraisal report from the Appraiser. The appraisal usually takes place within the first 2.5 weeks of going under contract.
Appraisal Objection Deadline: Buyer ‘s deadline to deliver an appraisal objection to the Seller due to low appraised value and/or required conditions to close. This deadline is the day after the Appraisal Deadline.
Appraisal Resolution Deadline: Seller and Buyer’s deadline to resolve appraisal concerns, which occurs on the day after the Appraisal Objection Deadline.
Improvement Location Certificate or Survey
New ILC or New Survey Deadline: Buyer’s deadline to perform an Improvement Location Certificate (like a mini survey). If this deadline applies, it normally needs to be performed within the first 2.5 weeks of going under contract.
New ILC or New Survey Objection Deadline: Buyer’s deadline to object due to Improvement Location Certificate or survey findings. It normally falls on the day after the ILC deadline above.
New ILC or New Survey Resolution Deadline: Seller and Buyer’s deadline to resolve ILC or survey concerns, which traditionally takes place the day after the objection. This is a subjective Buyer deadline.
Home Sale Contingency
Conditional Sale Deadline: If applicable, the Buyer’s deadline to sell their existing residence in order to qualify to purchase the new property. This deadline is dependent on the existing residence’s sale timeline.
Closing and Possession
Closing Date: The day the property transfers from buyer to seller. A normal closing timeline is 30 days.
Possession Date: The date the Buyer obtains possession of the property. In some cases, the seller will rent the home back from the Buyer after closing. This date identifies the date the Buyer can occupy the home.
Why Do You Need A Realtor For Your Contract Deadlines And Definitions
The Dempsey Group Real Estate is here to assist you in navigating the tedious process of contract deadlines and definitions when looking to buy or sell a home. We specialize in the Denver metro area when looking for luxury real estate, and our team of experts will work with you to find the ideal home for your needs.
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