It is Time to be Earnest
Ending the due diligence period and moving onto the earnest money.
Today marks the end of the due diligence period, which is between two and three weeks after an offer is accepted.
The buyer put down a couple thousand dollars of due diligence money (that we get to keep no matter what) to take the house off the market while the buyer sends inspectors and checks the place out. The buyer is free to walk away (but loses their DD money) if they find anything that puts them off of the sale.
Tomorrow, the buyer’s earnest money is due, held in escrow by the attorneys. This is a deposit toward buying the house, and will roll into the purchase price at closing time, but should the buyer walk away during this period, they would lose their earnest money, which is in the low five figures. It is essentially a guarantee that we all commit to making it to closing day now.
Over the next two weeks before our closing date, we will have time to finish the repairs requested by the buyer. This ranges from everything from tightening a loose outlet, to securing a shaky hand rail on the porch, to mitigating the water entering the basement.
Last week, our porch roof received its new water and ice shield and was re-shingled.
We have a few little things left to finish in June, like ensuring there is a rain cap on the chimney, but the major work is all done, and now we are looking forward to exploring what our next project will be.
Our original ARV (After Repair Value) for this house was $400k, and the appraisal just came back at over one hundred thousand more than that, so we added value to this home and to this neighborhood, which makes me proud of the work we did.
I truly hope our buyer will have so many happy times in this new house of theirs.
Next week, for paid subscribers, I will do a cost breakdown of each area of the project.
As always, thank you for following along on this learning journey of ours!