The Home Buying Process in South Carolina: A Step-by-Step Guide
Buying a home in South Carolina is a significant milestone, whether it's your first property or an addition to your investment portfolio. Understanding the process can help ensure a smooth transaction and minimize stress. Below, we outline the entire home buying journey, from making the first offer to closing the deal.
1. Making the First Offer: Mortgage or Cash
The first step in purchasing a home is deciding whether you’ll buy with a mortgage or pay in cash. If you’re financing your purchase with a mortgage, it's essential to get pre-approved by a lender. This not only sets your budget but also shows sellers that you’re a serious buyer. With cash, you bypass the financing process, which can make your offer more appealing to sellers.
Once you’ve decided how you’ll pay, your real estate agent will help you craft a strong offer based on the home’s market value, recent sales in the area, and any contingencies you want to include. The offer will include your proposed purchase price, the earnest money deposit (EMD) amount, and other terms of the sale.
2. Submitting the Earnest Money Deposit (EMD)
After the seller accepts your offer, you’ll need to submit an earnest money deposit, typically 2-3% of the purchase price. This shows the seller that you’re committed to the transaction. In South Carolina, the EMD is held in an escrow account by the attorney.
Along with your EMD, it’s important to send a copy of the deposit receipt to the seller's agent as proof of payment. This step solidifies your intent to move forward with the purchase and takes the home off the market.
3. Home Inspection and Repair Addendum
Once the contract is signed and the EMD is secured, you enter the inspection period, which usually lasts 7-10 days. During this time, you’ll hire a licensed home inspector to assess the property's condition. The inspector will check for structural issues, electrical problems, plumbing issues, and other potential concerns.
If the inspection reveals problems, you have the option to negotiate with the seller for repairs. This is done through a repair addendum, which outlines the issues found and the requested repairs or credits. The seller can agree to the repairs, offer a credit, or refuse to make changes, at which point you can choose to proceed with the purchase or walk away.
4. Termite Inspection and CL-100 Form
In South Carolina, a termite inspection is a standard part of the home buying process. The CL-100 form, also known as the Wood Infestation Report, is required by lenders and must be provided by the seller. It documents any signs of termites, other wood-destroying insects, or moisture issues that could impact the home's structural integrity.
If the inspection uncovers termite damage or other concerns, the seller is typically responsible for addressing these issues before closing.
5. Final Mortgage Approval (If Not Paying Cash)
If you’re financing your purchase, the next step is securing final mortgage approval. During this period, your lender will review your financial information, the home’s appraisal, and any other relevant documentation. They’ll issue a final approval letter once everything is in order, allowing you to move forward with the closing process.
It’s crucial to avoid making major financial changes during this time, such as taking out new loans or making large purchases, as this can affect your approval status.
6. Utility Transfers
Before closing, make arrangements to transfer utilities into your name. This includes electricity, water, gas, and any other essential services. Coordinate with the seller to ensure there’s no interruption in service during the transition.
7. Home Insurance
You’ll need to secure homeowner's insurance before closing, as lenders require proof of insurance. Shop around for a policy that covers the property and meets the lender's requirements. Make sure your insurance starts on the closing date to ensure the home is protected as soon as you take ownership.
8. Receiving Wiring Instructions
As closing day approaches, your attorney or title company will provide wiring instructions for the funds needed to complete the purchase. This includes the remaining balance of the purchase price, closing costs, and any other fees. It's essential to follow these instructions carefully and verify the details to avoid potential wire fraud.
9. Final Walkthrough
Typically, 24-48 hours before closing, you’ll conduct a final walkthrough of the property. This step ensures that the home is in the agreed-upon condition, with all requested repairs completed and no new issues present. It’s your last chance to confirm that everything is in order before finalizing the purchase.
10. Closing Day: The Final Step
Finally, the big day arrives! On closing day, you’ll meet at the closing table with your real estate agent and your attorney. You’ll sign all necessary documents, including the deed and mortgage paperwork if applicable. Once everything is signed, and funds are transferred, the keys to your new home will be handed over to you.
Congratulations, you’re now a homeowner in South Carolina!
Conclusion
Buying a home is a complex process, but with the right guidance and preparation, it can be a rewarding experience. If you’re considering purchasing a property in Hilton Head Island or Bluffton, working with experienced realtors like Chaz Holden and Tracy Lippert from Golden Homes is highly recommended. With their deep knowledge of the local market and personal experience as investment property owners, they can help you navigate the process with confidence and ease.
Whether you're a first-time buyer or a seasoned investor, understanding each step of the home buying process will help you make informed decisions and secure the home of your dreams.
