What Happens After You Go Under Contract? A Step-by-Step Look

For a buyer, getting an offer accepted is exciting, but it's just the beginning of a new phase in the home-buying process. For a seller, it marks the beginning of the central negotiation period. Once a buyer signs the contract and deposits their earnest money, they’ve officially gone "under contract,” also called entering "escrow." These terms are used interchangeably throughout the process, but they mean the same thing.

What Escrow Really Means

When you go under contract, the signed purchase agreement and earnest money deposit are held by a title company while the buyer completes due diligence and finalizes financing. The typical escrow period in Utah lasts 30-45 days, although timelines can be shorter or longer depending on your specific contract terms and market conditions.

During escrow, both buyer and seller work through three main contingency periods that protect the ability to back out if certain conditions aren't satisfied: inspection, appraisal, and financing. Understanding these contingencies and their deadlines is crucial because once they've passed, both parties are fully committed to the purchase.

The Due Diligence Period

Inspection Contingency

One of the first tasks under contract is conducting a professional home inspection. The inspector evaluates the property's condition, looking at everything from the roof and foundation to electrical and plumbing systems. Most homes always have some issues, so the key is distinguishing between normal wear and tear and significant problems that require attention during negotiation.

After reviewing the inspection report, the buyer has several options. They can remove the contingency and proceed as is, request repairs or credits from the seller, renegotiate the price, or cancel the contract if significant problems are discovered. Our agents help you navigate these negotiations strategically, focusing on items that truly matter.

Appraisal Contingency

The buyer’s lender will order an appraisal to confirm that the property's value supports the loan amount. If the home appraises at or above your purchase price, the buyer can feel confident to proceed with the purchase. But if it comes in low, they have options to pursue, whether it’s to renegotiate the price with the seller, bring additional cash to cover the gap, or exercise an appraisal contingency to cancel the contract.

Financing Contingency

Throughout escrow, buyers stay in close contact with their lender as they verify their financial information and finalize loan approval. For buyers, this is not the time to make major purchases, change jobs, or do anything that affects your credit or debt-to-income ratio. Even small financial changes can delay or derail your loan approval.

Once they’re confident in your financing, you'll remove this contingency or let the deadline for it pass without any renegotiations. If you fail to remove the financing contingency and, subsequently, don't get loan commitment from your lender, the seller can cancel the deal and keep your earnest money deposit. This makes staying on top of a loan application and working with reputable lenders critical.

Critical Milestones and Deadlines

The purchase contract (also known as REPC) includes specific deadlines for each contingency and milestone. Missing these deadlines can provide the other party with grounds to cancel and can cost leverage in negotiations. Our agents track these dates and keep you on schedule.

As you remove each contingency, you're progressively committing to the purchase. Once all contingencies are removed or passed and you've reached the "all escrow conditions satisfied" milestone, you're past the point of no return without risking your earnest money deposit. If repairs are negotiated, the sellers will complete them or provide credits according to the agreed-upon timeline. Any changes to the original contract are documented through addenda, which all parties must sign.

The Final Stretch to Closing

Final Walkthrough and Paperwork

As you near the closing date, several things happen simultaneously. The title company completes its work, ensuring clear ownership, and schedules the settlement appointment. The lender issues final approval and a "clear to close" status once all loan conditions have been met. A few days before closing, the buyer conducts a final walkthrough to confirm that the property is in the agreed-upon condition and that any negotiated repairs have been completed. This is the last chance to identify issues before taking ownership.

Real Estate Settlement and Closing in Utah

Unlike other states where both buyer and seller sit around a table together, Utah closings occur separately. The seller typically signs their closing documents first, then the buyer signs theirs. This can often happen on different days. Settlement occurs when the buyer signs all required documents and delivers their remaining down payment and closing costs to the title company (via wire transfer or cashier's check). Be alert for wire fraud scams — always verify wiring instructions by calling your title company directly using a number you've independently confirmed, never from an email.

After both parties complete the settlement, the actual "closing" happens when the title company records the deed with the county recorder's office. Once recording is complete, congratulations, you have officially sold or purchased your home!

When Challenges Arise

Even with the best preparation, issues can emerge during escrow. Inspection surprises, appraisal problems, financing hiccups, or seller complications can all create stress. The key is staying calm, flexible, and responsive. Our job is to help you navigate these challenges, problem-solve in real time, and keep the transaction moving forward.

Most deals that fall apart do so because of financing issues or significant inspection findings that can't be resolved. Having an experienced agent who anticipates potential problems and addresses them proactively makes all the difference.

Moving Forward with Confidence

The escrow period is manageable when you understand what to expect. If you have questions about what happens after going under contract, we're here to walk you through every step of the process.