After the inspection and appraisal are done, a home purchase moves out of the investigation phase and into the roughly two-to-four-week push toward closing. In that stretch you negotiate any inspection findings with the seller, resolve an appraisal that came in low if that happens, clear final underwriting, review your Closing Disclosure, do a walkthrough, and sign. Each step has a hard deadline, and missing one can delay or kill the deal.
Negotiating Repairs or Credits With the Seller
Your contract gives you a response window after the inspection report, usually five to ten days, to formally ask the seller for repairs or financial concessions. Most buyers submit an inspection addendum naming specific concerns, such as a failing roof, outdated electrical panels, or foundation cracks. The seller can agree to fix the items, lower the price, or offer a closing cost credit.
Credits tend to be the smoothest path. They reduce the cash you bring to closing and let you hire your own contractors after you take possession, instead of relying on a rushed repair the seller arranges in the final days before closing. A seller might offer a $3,000 credit for a deteriorating deck rather than scramble to replace it. Any credit gets written into an amendment so the lender can adjust the final numbers. If the seller agrees to do repairs instead, most contracts require licensed professionals and documentation.
If you cannot reach agreement inside the response window, the inspection contingency lets you walk away and recover your earnest money deposit, which commonly runs 1% to 3% of the purchase price in balanced markets. Cancel within the contractual deadline and that deposit stays protected.
How Much a Seller Can Credit You
Your lender caps seller credits, and the cap depends on your loan program. For conventional loans backed by Fannie Mae, the limit scales with your down payment:
- Less than 10% down: up to 3% of the sale price
- 10% to 24.99% down: up to 6%
- 25% or more down: up to 9%
Anything above those thresholds is subtracted from the sale price before the lender calculates your loan.1Fannie Mae. Interested Party Contributions (IPCs) FHA loans allow concessions up to 6% of the sale price regardless of down payment. VA loans cap concessions at 4% of the sale price for items beyond normal closing costs. Check your program’s cap before you ask, so you do not request something the lender will reject.
What to Do if the Appraisal Comes In Low
A low appraisal is the more disruptive outcome. Lenders base your loan on the lower of the purchase price or the appraised value, so a shortfall lands on you. If you offered $400,000 and the appraisal comes back at $385,000, that $15,000 gap does not go away. You cover it with extra cash at closing, get the seller to drop the price, or split the difference.
If no one will move, the appraisal contingency lets you cancel without losing your earnest money. Many deals break here, because the gap hits the buyer’s savings and the seller’s expected proceeds at the same time.
Challenging a Low Appraisal
You can request a reconsideration of value if you believe the report has errors or missed important details, such as inadequate comparable properties or upgrades the appraiser overlooked.2Consumer Financial Protection Bureau. Mortgage Borrowers Can Challenge Inaccurate Appraisals Through the Reconsideration of Value Process Fannie Mae and Freddie Mac formalized borrower-initiated reconsideration of value requirements in 2024, and the appraiser now has to update the report to correct confirmed errors whether or not those errors change the final value.3Fannie Mae. Reconsideration of Value (ROV) If you or your agent can identify better comparable sales the appraiser missed, that is your strongest argument for a higher value. Success rates are not high, but the effort can be worth it.
Final Underwriting and Clear to Close
With the property issues settled, the lender’s underwriting team takes a last hard look at your finances. They verify recent bank statements, pay stubs, and tax returns to confirm your debt-to-income ratio has not shifted. They also pull a fresh credit report to check for new accounts or new debt. This is the stage where buying a car or financing furniture can derail your closing, because even a small change in your debt load can push you past the lender’s threshold.
Insurance and Title
Before the lender signs off, you need proof of homeowners insurance. If your formal policy has not been issued, an insurance binder works as temporary proof. It must list adequate coverage, name you as the insured, and identify the lender as the loss payee. Binders expire within 30 to 90 days, so timing matters.
The lender also requires a lender’s title insurance policy, which protects the mortgage holder if a title defect surfaces later. A separate owner’s title policy is optional but worth considering. The lender’s policy covers only the loan balance, and that coverage shrinks as you pay down the mortgage until it disappears. An owner’s policy protects your equity for as long as you or your heirs own the property.4Consumer Financial Protection Bureau. What Is Owner’s Title Insurance? Both policies rest on a title search for outstanding liens, judgments, or easements that could cloud ownership. Anything the search finds must be cleared before the lender will fund.
The Closing Disclosure and the Three-Day Rule
Once the underwriter clears all conditions, the lender issues a “clear to close” and prepares the Closing Disclosure. This five-page document lays out your final loan terms, interest rate, monthly payment, and every closing cost. Federal law requires you to receive it at least three business days before you sign.5Consumer Financial Protection Bureau. What Should I Do if I Do Not Get a Closing Disclosure Three Days Before My Mortgage Closing? Compare the figures against the Loan Estimate you received when you applied. If fees jumped or the rate changed without explanation, push back now. Certain changes, like a higher interest rate, restart the three-day clock.
Guard Against Wire Fraud
This is where the largest amount of money is at risk and where the fewest buyers are paying attention. Criminals hack into email accounts at real estate brokerages, title companies, and law firms, monitor transactions as they approach closing, and send a convincing last-minute email with fake wire instructions that routes your down payment to a fraudulent account. The FBI has tracked real estate wire fraud losses exceeding $213 million in a single year, with victim counts climbing.
The emails look legitimate and often cite real transaction details, including your property address and closing date. Once the money leaves your account, recovery is extremely difficult and sometimes impossible. Before you send any funds, call the title company or closing attorney at a number you verified independently, not one lifted from an email, and confirm the routing and account numbers out loud. Treat any last-minute change to wiring instructions as a near-certain sign of fraud.
The Final Walkthrough
Most buyers walk the property within 24 to 48 hours of closing. This is not a second inspection. You are confirming the seller moved out, left the home in the agreed condition, and completed any repairs from the negotiation phase. Check that appliances included in the sale are still there. Run the faucets, turn on the HVAC, open every door.
If you find problems, such as a broken window or a fixture the seller removed, raise them before you sit down at the closing table. Resolving these issues gets much harder after you sign. One common fix is a holdback, where the closing agent keeps part of the seller’s proceeds in escrow until the problem is corrected.
Closing Day
At closing, a settlement agent or real estate attorney walks you through the documents that finalize the sale. You sign the promissory note committing to the repayment terms and the deed of trust pledging the property as collateral. The seller signs a warranty deed guaranteeing clear title and the right to transfer ownership. The deed gets recorded at the county recorder’s office to create a public record of the ownership change.
Bringing Your Funds
You will owe the remaining down payment plus closing costs, which typically run 2% to 5% of the loan amount on top of the down payment.6Fannie Mae. Closing Costs Calculator Most title companies accept wire transfers or cashier’s checks. Personal checks are almost never accepted at these amounts. Some settlement agents have stopped taking cashier’s checks for larger sums because of fraud concerns, so confirm the acceptable method a few days ahead. Bring a valid government-issued photo ID.
After You Sign
Once every document is executed, the settlement agent distributes the funds. The seller’s existing mortgage gets paid off, commissions are disbursed, and the seller receives the remaining proceeds. In most transactions you get the keys the same day, though some states and contracts allow the seller a short post-closing possession period. The deed is submitted for recording, and once the county processes it, the legal transfer is complete.
Extra Steps if the Home Is in an HOA
If the property belongs to a homeowners association, expect added paperwork before closing. Most transactions require a resale certificate or disclosure package from the HOA covering the association’s financial health, current dues, any special assessments, pending litigation, and whether the seller has outstanding violations or unpaid fees. Read it carefully. Underfunded reserves or a looming special assessment can cost you thousands shortly after you move in.
An estoppel letter from the HOA usually appears before closing as well. This legally binding document freezes the seller’s account balance as of a specific date, preventing the association from later claiming fees that were not disclosed. Processing generally runs 10 to 15 business days, so your agent or title company should request it early enough that it does not hold up closing.