Inspections & Appraisals

The Process

Initial Agreement and Deposit

A purchase agreement is a legally binding arrangement between a buyer and a seller that sets the terms and timeline for the transaction. To keep the process on track, consider the following:

• Keep written records of everything, including verbal agreements, counter-offers, and addendums
• Stay on schedule, as both you and the seller will be working within an agreed-upon timeline to complete each stage of the closing process

The Closing Agent

Once both parties have signed the contract, either a title company or an attorney will serve as the escrow or closing agent. The escrow is a neutral third party responsible for holding, receiving, and distributing all transaction funds until closing. They will research the full history of the property to confirm the title is clear of encumbrances and that any new encumbrances are correctly recorded. All contingencies outlined in the Purchase Agreement must be satisfied before escrow can close and ownership can transfer.

How to Hold Title

There are several methods of holding title to a property, each carrying different implications for ownership transfer, financing, collateralization, and taxation. We strongly recommend consulting with an attorney or tax advisor to determine the best approach for your specific situation. Our team is happy to connect you with trusted legal and financial professionals in the Greater Boston area.

Inspections

As part of the contingencies in the Purchase Agreement, you will arrange for a licensed property inspector to evaluate the home within the agreed-upon timeframe. Inspectors assess the overall condition of the property and identify any issues that require attention. You may also wish to bring in specialists for specific systems such as roofing or plumbing. If you are purchasing a commercial property, an environmental audit or soil test may be required by your lending institution. If the inspection reveals issues not addressed in the purchase agreement, you have the right to request a renegotiation of terms. Once you are satisfied with the inspection findings and the agreed terms, the contingencies will be formally removed.

Appraisals and Lending

Stay in close contact with your lender throughout the process to ensure all required documents are submitted promptly. If the Purchase Agreement is contingent on financing, the lender will require an independent appraisal by a licensed third-party appraiser. The appraiser will assess the property's value based on a range of factors including building costs, square footage, and operating income. We recommend confirming with your lender approximately two weeks before closing to ensure loan approval will be finalized on time.

Association Approval

Some properties require approval from a homeowners or condominium association before a sale can be completed. If this applies to your purchase, request all governing rules, regulations, and required documentation from the seller. The Purchase Agreement will establish the timeline for submitting any required paperwork or completing association-required appointments. Once approved, your closing agent will obtain the original approval letter to be recorded alongside the deed in the county records.

Property Insurance

Property insurance protects your investment against damages caused by fire, theft, and certain weather events. While coverage is not legally required in most states, the majority of mortgage lenders will make it a condition of financing. Depending on your intended use of the property, you will need to secure either homeowners insurance if you plan to occupy the home, or landlord insurance if you intend to use the property as an income-generating investment.