Inspections & Appraisals

The Process

Initial Agreement and Deposit

A purchase agreement is a legal arrangement between a buyer and seller. A few tips to help streamline the process:

• Keep written records of everything, including verbal agreements, counter-offers, and addendums. Tanaka Real Estate can help draft and provide copies of all written records for each party.
• Stay on schedule. You and the seller will follow an agreed-upon timeline through every stage of the closing process.

The Closing Agent

Once both parties have signed the purchase agreement, a title company or attorney will serve as the escrow, or closing agent, and your deposit will be submitted. The escrow acts as a neutral third party, holding and distributing all transaction funds until closing. They'll research the property's full title history to confirm it's free of encumbrances and that any new liens are properly recorded. Before escrow can close, all contingencies outlined in the purchase agreement must be satisfied.

How to Hold Title

There are several ways to hold title, or ownership, of a property, each with different implications for ownership transfer, financing, and taxes. We recommend speaking with an attorney or tax advisor to determine the best method for your situation, and Tanaka Real Estate is happy to connect you with trusted local professionals.

As outlined in the purchase agreement, you'll schedule a licensed inspector to evaluate the property within an agreed-upon timeframe. Inspectors assess the home's condition and flag any issues. You may want additional specialized inspectors for things like the roof or plumbing. For commercial properties, an environmental audit or soil test may be required by the lender. If an inspection uncovers issues not addressed in the purchase agreement, you can request a renegotiation of terms, often the price. Once you're satisfied with the results, the inspection contingency is removed.

Appraisals and Lending

Stay in close contact with your lender so you know when additional documents are needed to finalize your loan. If your purchase agreement is contingent on financing, the lender will require a home appraisal from a licensed third-party appraiser to confirm the property's value based on factors like building costs, square footage, and income potential. Check in with your lender about two weeks before closing to confirm your loan is on track for approval.

Association Approval

Some properties may require HOA or association approval before purchase. If so, request all rules, regulations, and required documents from the seller. Your purchase agreement will include a timeframe for submitting paperwork or scheduling any necessary appointments for approval. Once accepted, your closing agent will request the original approval letter so it can be recorded with the deed at the county's record office.

Property Insurance

Basic property insurance protects against damage from events like fire, theft, and certain weather conditions. While not all states require coverage, most mortgage lenders do. Depending on your plans for the property, you'll need homeowners insurance if you're moving in, or landlord insurance if you plan to rent it out as an investment property.