We had a signing last week. Our client moved here from the east and was surprised by the way things were done and although I had explained the differences to her, they just seemed, well, abnormal to her. It got me to thinking that the way we do real estate in Northern California (as apposed to Southern California where it is done a different way) is not the same way many other states do things.
In our area, Fantasy Island, we generally have all property inspections done, and paid for, by the seller prior to listing a home. Not so in other areas of the state and country. Now if you don’t like that inspection, you are free to have a new one, but if it’s done by one of the better inspection companies around and we, as your agents see no red flags, generally the inspection is accepted. Likewise, should that inspection alert you to something, you are free to order additional inspections either prior to entering into the contract or while in contract. Unless something egregious shows up, we do not renegotiate the contract since we usually know the condition of the property prior to writing the offer. This is quite different from other places, even within California and our own Bay Area. The buyer doesn’t generally renegotiate over little things. What you see is what you get. That includes the full Disclosure package prepared by the listing agent with all of the documentation filled out by the seller including a Pre-Sale Preliminary Title Report. It’s up to the Buyer to do due-diligence and the Disclosure Package provides most of it.
Once a contract is ratified, the good faith money of 3 percent opens up the Escrow Account. In our area, the Title Company and the Escrow Company are one in the same. A new Preliminary Title Report is run to make sure we have no surprises, and if everything looks good, you move forward. This is pretty much the same almost everywhere.
What is different is what we call “The Signing”. We meet at the Title Company and the Deed of Trust is signed, the loan documents and any additional papers that need signing are signed. That’s it. If the buyer has had additional funds to add to the 3% deposit they have either been deposited into the Escrow account, or will be, prior to the Close of Escrow. Wiring instructions are given to the buyer should they have funds being wired. Sometimes they come in with a Cashier’s Check at the signing or it they are selling a house and buying simultaneously the Escrow Officer handles everything in-house.
All of this takes place about a week prior to the recording of the property into the buyer’s name. This is what is different. We have no attorney’s at the table. You do not sit across from the seller. You do not exchange checks and receive the keys at that table. In essence, we do not have a Settlement we have a Signing. All monies move the day prior to the closing.
The day the title is recorded in the name of the buyer, we as your agent, receive a call from the Escrow Officer telling us “we are on record.” You now own your new home. We then get to done of the the best calls we ever make, calling you with the good news that you own a new home, and make arrangements to present your keys. That’s it. That is how it works in San Mateo County.