When buying a home, are they counting calendar days or business days?

Question_markIf you are purchasing a home in Silicon Valley, and you’re fortunate enough to be “in escrow”, will you be counting the calendar days or the business days to know when something is due?

Most of the time, it will be calendar days.  But not always.  I’ll explain.

First, I have to mention that in Santa Clara and San Mateo Counties, we have two different sets of real estate forms in use and they do not handle this issue of days exactly the same.  The PRDS contract is found primarily on the Peninsula and following the coastal range south through Cupertino, Saratoga, Monte Sereno, and Los Gatos.  In most other places, though, the CAR contract is usually used.   For more information on the contract differences, please see What is the difference between the CAR and PRDS purchase agreements? Does it matter which contract is used? – though the forms have been updated since then and some of the differences may have changed some.)

There are a lot of dates that get tracked in both contracts: the amount of time for getting the initial good faith deposit to escrow (a title company is the norm here for escrow); the number of days the seller has to provide the buyer all disclosures, reports, and other info; the length of time (if any) for the buyer to remove contingencies, the date of closing, and more.

Initial deposit:  for both, 3 business days is the norm, but it is possible to change it to make it faster or longer (but if longer, it’s wise to have a really good reason)

Removal of contingencies:  PRDS is strictly calendar days.  CAR is calendar days unless they fall on a weekend, in which case it rolls to the next business day.

The real estate purchase contracts, and related addenda, disclosures, etc., changes frequently.   When there is a change, Realtors usually know about it via their real estate board, their office, and often from the marker of the forms.

Where to watch out (for Realtors especially):

If you or your agent is used to one of these sets of forms and suddenly need to use the other, (more…)

The initial deposit on Silicon Valley real estate purchase contracts

Dollar LincolnIf you are planning to purchase a home in Silicon Valley, most likely you’ll be working with a real estate professional and together you will use either the California Association of Realtors (CAR) purchase agreement form or the Peninsula Regional Data Source contract (PRDS). Both of them begin with the same basics: who is making the offer, what property is involved, how much is being offered to the home owner and how much is being put down or put into escrow as an initial deposit or good faith deposit.

What is the initial deposit in real estate contracts?

The initial deposit, or good faith deposit, is the amount of money which the buyer puts into the escrow account at the beginning of the transaction. It is usually given in a personal check, which is cashed within a day or two of being brought to the escrow holder (in our area, that’s a title company – in southern California, they tend to use escrow companies or even one of the real estate brokers).  Some home buyers wire in the funds. Either way, unless the boilerplate is changed, the money is due within 3 business days of contract acceptance. (more…)

If my real estate purchase offer is accepted, when will they cash my check?

Silicon Valley home buyers want to understand time frames, expectations and requirements when signing a purchase offer on real estate.  One of the most important to fully grasp is when the initial deposit check will go to escrow and be cashed.

The quick answer to the question about when the Silicon Valley real estate purchase offer check will be cashed:

Your initial deposit check or good faith deposit check (or wire transfer or other means of conveyance) is due within 3 business days of acceptance (also called “contract formation”) unless the contract is changed by checking the box and filling in the blank for a different answer.  By the way, everywhere else in the contract, time is measured by “days”, not “business days”. This is the one exception! (more…)