If you have been using our Colorado Springs Real Estate Search tool, and you are ready to sign a contract to buy a home, the paperwork can be a bit confusing and overwhelming – especially because it is nearly 20 pages long! We’ll help you understand the real estate contract dates & deadlines to make sure you are adhering to the contract deadlines.
There are 39 possible deadlines in the Contract to Buy and Sell, but you don’t typically use all of them in a normal transaction. Real estate agents set the dates of the contract based on when they believe they can get the items accomplished. Most dates in the contract are related to the Mutually Executed Contract (MEC) date which is the last date the final person signed the contract (including counterproposals).
Before you sign the contract, if you learn what these dates mean and how they relate to other dates, you will understand 75% of the contract. Many people feel more comfortable with a Real Estate Attorney reviewing their contracts. If you are in this group, by all means, run the contract by your attorney.
Let’s go through each one in order to make sure you are prepared for the single largest purchase in your lifetime.
The Alternative Earnest Money Deadline is when the earnest money is due. This deposit must be turned into either the Brokerage or Title Company in either check or electronic form. The amount of the deposit is usually set by the sales contract and is typically available in the MLS. This date can be 1-3 days from the the MEC.
The Record Title Deadline is the deadline in which the Title Company must provide the Buyer a current commitment for an owner’s title insurance policy.
This will consist of copies of any plats, declarations, covenants, conditions & restrictions burdening the property. In addition, any copies of other documents listed in the Schedule of Exceptions in the Title Commitment must be provided. This date is usually 10-14 days from the MEC.
The Record Title Objection deadline allows the Buyer to object to the title condition. This is at the Buyer’s discretion and can therefore be based on any unsatisfactory title condition. This date is typically 12-15 days from the MEC.
The Off-Record Title Deadline is when the Buyer must receive copies of all existing documents in the Seller’s possession and must disclose to Buyer all easements, liens, leases, agreements or other title matters not shown by public records, of which the Seller has actual knowledge. This date is usually 10-14 days from the MEC.
This is similar to the Record Title Objection. The Buyer can object & terminate if unsatisfied with documents provided in item No. 4, the Off-Record Title Deadline. This date is usually 12-15 days from the MEC.
The Title Resolution Deadline is the date by which all title objections must be resolved. This date is typically 15-17 days from the MEC.
The Right of First Refusal date applies to situations, where an outside entity, like an HOA, has to approve a Buyer’s contract. If the entity who holds this right disapproves the contract, the contract terminates. The right of first refusal is common with a back-up offer if the contract has a contingency. This date is usually 5-7 days from the MEC.
The Listing Agent typically handle the Association Documents (HOA documents) for the Seller. This is the deadline for which the Buyer must receive all current HOA documents.
It is VERY important for Buyers to review all documents of this nature especially in townhome or condo communities. This is where buyers can find pet, architectural control, covenants, parking, and many other rules and restrictions. Oftentimes, HOAs need appropriate time to deliver these documents. This date is typically 10-14 business days from the MEC.
The Association Documents Objection Deadline gives the Buyer the right to terminate the contract based on any unsatisfactory provisions in the HOA docs. This date is usually 10-14 Business days from the MEC.
Sellers typically complete the Seller Property Disclosure before listing their home for sale. This is the Sellers disclosure on any issues or improvements that they have any knowledge of pertaining to the home. There is no objection for this because it’s simply a disclosure. The Buyer will have their own inspections to get the current facts on the property. This date is typically 1-3 days from the MEC.
The Lead Based Paint Disclosure is important only for homes built before 1978 and does not apply if the home was built after this date. A Seller agrees to deliver the lead-based paint disclosure and the EPA Brochure “Protect Your Family From Lead in your Home” to the Buyer on or before the deadline. The Buyer will then have until the mutually agreed date to terminate the contract and receive the return of their earnest money based on the disclosure. This deadline is understandably early in the contract and is usually 1-3 days from the MEC.
The Loan Application Deadline is the deadline in which the Buyer must submit a full loan application to the lender. In most cases,Buyers have usually gone through this process before submitting an offer. This date is typically 1-3 days from the MEC.
The New Loan Termination Deadline is to aid the Buyer determining whether the new loan is satisfactory to their needs. This includes payments, interest rate, terms, conditions, and cost. This deadline is for the sole benefit of the Buyer. This is usually 24-30 days from the MEC.
The Buyer’s Credit Information Deadline applies in the case of owner carry financing. The Buyer must supply the Seller with financials, a credit report or other documents requested. This deadline is usually 7-10 days from the MEC.
The Disapproval of Buyer’s Credit Information is the Seller’s opportunity to decline the Buyer based on the information provided. This date is typically 10-14 days from the MEC.
The Existing Loan Deadline is only applicable for if the Buyer is going to assume the Seller’ existing loan. The Seller must provide all current loan documents to the Buyer for review. This deadline is typically 7-10 days from the MEC.
Once the Buyer receives the Seller’s current loan information, they have the right to review the terms and object or decline thereby terminating the contract. This date is usually 10-14 days from the MEC date.
Again, this deadline only applies if the Buyer is going to assume the Seller’s existing loan. This is the deadline for the Seller’s Lender to approve the loan assumed by the Buyer. This deadline is typically 21-28 days from the MEC.
The Seller or Private Financing Deadline only applies if any portion of the financing of the transaction is provided by private or seller financing. The Buyer must decide by this date if the financing being offered is acceptable. This deadline is typically 21-28 days from the MEC.
The Appraisal Deadline is the date in which the Buyer must receive an appraisal of the property. In most cases where there is a loan, the Lender will require an appraisal in order to determine the property’s current market value. This can be an important deadline to monitor because appraisers tend to fall behind during the busy season. This does not apply to VA loans. This deadline is typically set 18-21 days from the MEC date.
The Appraisal Objection Deadline is when the Buyer must submit in writing that the valuation is less than the purchase price and outline the appraiser requirements of work to be done before it can close. (For example, Remove the chipped lead based paint from the side of the house). This deadline is usually set at 18-21 days from the MEC and is typically set at the same date as the Loan Termination deadline.
If there is an appraisal objection, the Appraisal Resolution Deadline is when the objection needs to be resolved. At this point, a couple of things can occur: a) the Seller can come down in price to match the valuation; b) the Buyer can bring the difference in cash or c) the Contract can terminate. An agreement must be reached by this date or the contract terminates. This deadline is set 21-24 days from the MEC date.
An Improvement Location Certificate (ILC) or Survey is usually only ordered if the title company (and in some cases the lender) requires it, or if the Buyer has questions as to where the exact property lines are. The New ILC or New Survey Deadline outlines when the Buyer must receive either document by the deadline. This date is usually defined as 18-21 days from the MEC date.
The New ILC or New Survey Objection Deadline is the date when the Seller must receive a written description of any matter that is unsatisfactory and the Buyer requires the Seller to correct. This date is typically set 18-21 days after the MEC date.
If there is an ILC or Survey objection, the issue must be resolved by this date or the contract terminates. The resolution deadline must be after the objection deadline and is commonly set 21-24 days from the MEC contract date.
The Buyer has the right to have a professional inspection done of the property. All home inspections completed by this date. The Inspection Objection Deadline is the date by which the Seller must receive a written description of any unsatisfactory physical condition that the Buyer requires the Seller to correct. This is an important deadline and is typically set 7-10 days from the MEC date.
The Inspection Termination and Resolution Deadlines only pertain if an objection is sent. If an objection is received by the Buyer, the Seller has until this date to respond in writing, addressing the repair requests from the Buyer. The Buyer has to agree to the terms or the contract terminates. This date is usually set 10-14 days from the MEC and is usually the same date as the resolution.
If an Inspection Objection is received by the Buyer, the Seller has until this date to respond in writing addressing the each of Buyer’s repair requests. If the Buyer and Seller cannot agree to the terms or agree to withdraw the objection, the contract terminates. This date is usually set 10-14 days from the MEC and is usually the same date as the inspection termination.
If there is financing required to purchase the property, the Lender will require property insurance to be obtained, commonly called homeowner’s insurance. The Property Insurance Termination Deadline is when the Buyer must obtain as many bids as they’d like for their homeowner’s insurance. If the insurance does not meet their satisfaction, they must terminate in writing by this deadline. This date is usually set 21-24 days from the MEC date.
In the contract, if the box is checked in the Due Diligence section, the Seller agrees to deliver copies of specific documents pertaining to the property. This can include any leases, completed contract work, warranties, permits, etc. This date is commonly set 7-10 from the MEC prior to the Inspection Objection date.
If the Due Diligence Documents are not supplied to the Buyer, or are incomplete or unsatisfactory, the Buyer can terminate or Object. When the Buyer objects, they must provide a written description of the documents that they require the Seller to correct or supply. This date occurs 8-11 days from the MEC date.
If there is a Due Diligence Document Objection, the issues must be resolved or the objection retracted by the Due Diligence Documents Resolution Deadline or the contract terminates. This deadline is set after the delivery deadline and is typically 10-14 days from the MEC.
The Conditional Sale Deadline only is applicable If the Buyer has a property to sell before they can complete the purchase of the property under contract. The contingent property must be sold and closed by the conditional sale date, or the Buyer may terminate the contract. This date is flexible.
Beginning in 2019, the Colorado Department of Regulatory Agencies added the Lead-Based Paint Termination Deadline for the Buyer to terminate the contract and receive the return of their earnest money if they are not satisfied with the lead-based paint disclosure or any of the results of the lead-based paint inspection(s). This deadline is set 10-14 days from the MEC date.
The Closing Date is when the loan papers are signed and the Seller delivers the deed to the Buyer. After closing the Buyer can take possession of the property on the date and time specified in the contract. The Closing Date is typically set 30-45 days from the MEC.
The Possession Date and Time is when the Buyer gets keys and the Seller is no longer allowed to enter the property. This is usually called the Delivery of Deed (DOD) and is usually the date of closing or one day after closing. If the Seller requires more time to occupy the property, a Post Closing Occupancy Agreement must be signed.
This is the day and time in which the Buyer requires the Seller to respond to their offer. This is typically 1 day from the date of the contract. If the Seller is offering a counterproposal, a new deadline is established on the counterproposal and a new MEC will be established.
These real estate contract dates and deadlines might seem so overwhelming when reviewing the contract, but they all serve an important purpose in the negotiations of the contract.