By Susan Stark
Accepting an offer on your home is one of the most rewarding moments in any real estate transaction. After all the preparation, the showings, the negotiations, and the waiting, you finally have a signed contract in hand. You may be surprised to learn that the period between offer acceptance and closing day involves quite a bit of activity and quite a few moving parts. Understanding what comes next puts you in control and helps you avoid the surprises that catch some sellers off guard.
Whether this is your first time selling or you've been through it before, having a clear picture of what lies ahead makes the whole experience feel far more manageable.
Key Takeaways
- Accepting an offer is just the beginning; the closing process typically spans 30 to 45 days and involves multiple coordinated steps.
- Escrow acts as a neutral third party that manages funds, documents, and the overall timeline until the transaction closes.
- The buyer's inspection and appraisal can trigger negotiations, so knowing your goals and options in advance helps you respond with confidence.
- Contingencies are built-in deadlines that both parties must meet, and missing them can delay or even derail a sale.
- Staying organized and responsive during escrow keeps everything on track and protects your proceeds.
What Opening Escrow Actually Means
Once you accept an offer, the first thing that happens is the opening of escrow. Escrow is a process in which a neutral third party — typically a title or escrow company — holds all funds, documents, and instructions until every condition of the sale has been met. Think of it as a structured holding period designed to protect both you and the buyer.
At this stage, the buyer submits their earnest money deposit, which is a good-faith payment that signals their commitment to moving forward. In Los Angeles, earnest money deposits typically range from one to three percent of the purchase price, though this can vary based on the competitiveness of the offer and what was negotiated in the contract.
The escrow officer becomes a central figure throughout the remainder of the process. They communicate with both sides, coordinate with lenders, prepare closing documents, and ensure that all contractual obligations are fulfilled before the transaction is finalized.
What Happens During Escrow?
- The escrow officer receives and verifies the earnest money deposit from the buyer.
- A preliminary title report is ordered to confirm clear ownership and identify any liens or encumbrances.
- Both parties receive copies of the escrow instructions, which outline the agreed-upon terms and deadlines.
- Your lender, if you have an existing mortgage, is contacted to request a payoff statement.
- Title insurance is ordered to protect both the buyer and lender from future ownership disputes.
Navigating Inspections and the Buyer's Due Diligence
Once escrow is opened, the buyer enters their due diligence period. This is when they have the right to investigate the property thoroughly, typically through one or more professional inspections. In California, this window is usually 17 days by default, though the timeframe can be adjusted through negotiation.
The general home inspection is the most common, but buyers often bring in specialists depending on the property and their concerns. Roof inspectors, pest inspectors, pool inspectors, and structural engineers may all visit the property during this window. As a seller, you are generally not required to be present for these inspections, though our team will keep you updated throughout.
What matters most is what happens after the inspection reports come back. If the buyer identifies issues, they may submit a request for repairs, a request for a price reduction, or a request for a credit at closing. None of these requests are automatic obligations; you have the right to counter or decline. However, responding thoughtfully and promptly keeps the deal moving and reduces the risk of the buyer exercising their right to cancel.
How Sellers Typically Respond to Inspection Requests
- Agreeing to complete specific repairs before closing, using licensed contractors.
- Offering a credit at closing instead of making physical repairs, which gives the buyer flexibility.
- Reducing the purchase price to account for the condition of the property.
- Declining the request and providing documentation that supports your position.
- Negotiating a combination of the above, depending on what the buyer is most concerned about.
The Appraisal and What It Means for Your Sale
If the buyer is financing the purchase, their lender will order an appraisal during the escrow period. The appraisal is an independent assessment of the property's market value, and the lender uses it to confirm that the home is worth what they're agreeing to lend.
If the appraisal comes in at or above the purchase price, the process continues without interruption. If it comes in below the purchase price, you are in what's known as an appraisal gap situation. At that point, the buyer may need to cover the difference in cash, the buyer and seller may negotiate a price reduction, or in some cases, the deal may need to be restructured.
It's worth noting that an appraisal gap does not automatically mean the deal falls apart. Many transactions work through appraisal shortfalls with a combination of buyer contributions and seller concessions. We will help you evaluate your options and advise you on what makes sense given the broader context of the transaction.
Key Facts About the Appraisal Process
- The buyer's lender, not the buyer, orders and pays for the appraisal.
- Appraisers use recent comparable sales in the area to establish value.
- If the property appraises low, you can request a reconsideration of value if you have supporting data.
- An all-cash sale does not require an appraisal, though some buyers opt to get one anyway.
Contingencies, Deadlines, and Removing Them
A contingency is a condition that must be met for the sale to proceed. Most purchase contracts include several contingencies built into the timeline, and each one has a deadline. Missing or ignoring those deadlines can create complications, so understanding them is essential.
The three most common contingencies in most transactions are the inspection contingency, the appraisal contingency, and the loan contingency. Once the buyer has completed their due diligence and is satisfied, they remove their contingencies in writing — a step that signals increasing commitment to the transaction. The loan contingency is often the last to be removed, since it depends on final approval from the lender.
If a buyer misses a contingency deadline without requesting an extension, you may have options under the terms of the contract. In practice, most situations are handled through communication and mutual agreement, but having a clear understanding of where you stand at each stage of the process gives you better footing if any issues arise.
Common Contingencies in a California Sale
- Inspection contingency, which allows the buyer to review the property's condition and request repairs or cancel.
- Appraisal contingency, which protects the buyer if the home appraises below the purchase price.
- Loan contingency, which allows the buyer to exit the contract if financing falls through.
- Title contingency, which ensures that the title is free of defects or disputes.
- Sale contingency, which applies when the buyer must sell their existing home before purchasing yours (less common in competitive markets).
FAQs
Can a Buyer Still Back Out After Accepting an Offer?
Yes, under certain conditions. As long as the buyer's contingencies are in place, they retain the right to cancel the contract and receive their earnest money deposit back. Once all contingencies have been removed, the buyer's deposit is typically at risk if they choose to walk away without cause.
How Long Does It Take To Close After Accepting an Offer in Los Angeles?
Most transactions close within 30 to 45 days of offer acceptance, though cash transactions can close in as few as 14 days. Timelines can extend if there are delays in the appraisal, loan approval, or title clearance process. Staying responsive and organized on your end helps prevent unnecessary slowdowns.
What Do I Need To Do During Escrow as the Seller?
Your main responsibilities during escrow include completing any agreed-upon repairs, providing documentation requested by the title or escrow company, signing closing paperwork, and ensuring that the property is in the agreed-upon condition before the final walkthrough.
What Is a Final Walkthrough and When Does It Happen?
The final walkthrough typically takes place within 24 to 48 hours before closing. It gives the buyer an opportunity to confirm that the property is in the condition agreed upon in the contract, that any negotiated repairs were completed, and that no new damage has occurred. It is not a second inspection; it is a confirmation visit.
What Happens on Closing Day?
On closing day, the escrow company confirms that all funds have been received, all documents have been signed, and all conditions of the sale have been met. Once the deed is recorded with the county, ownership transfers to the buyer and you receive your proceeds. In most cases, you will need to have vacated the property before or on the closing date as agreed in the contract.
Your Next Chapter Starts Here
Every deadline, every decision, and every piece of documentation matters. But when you understand the process and have the right guidance beside you, this phase of the sale becomes something you can navigate with clarity and confidence rather than stress and uncertainty.
If you're preparing to sell and want to make sure everything goes smoothly, reach out to me, Susan Stark. I'd love to help you get to closing day with confidence.
