BUYER GUIDE · UNDER CONTRACT & ESCROW
Your Offer Was Accepted. What Happens Next?
Once your offer is accepted, you are under contract and the transaction moves into the period often referred to as escrow. Several things now happen at the same time: earnest money, inspections, title review, financing, appraisal, insurance, closing preparation, and the contract deadlines tied to each.
Start With the Contract Deadline Calendar
The accepted contract determines the dates that matter.
Some deadlines may affect inspection, title, association documents, appraisal, financing, property insurance, or other parts of the transaction. The exact dates and rights depend on the contract you signed.
For each upcoming deadline, know:
- what needs to be reviewed
- who is responsible for getting it done
- what information is still missing
- what decision you may need to make
- how much time remains before that decision is due
A problem discovered during escrow does not automatically mean the purchase is over.
First understand the problem. Then determine which contract provision and deadline applies and what choices remain before that deadline passes.
The Colorado Division of Real Estate provides the current Commission-approved contracts and forms used in Colorado brokerage transactions.
Deliver Earnest Money as Required by the Contract
Your contract should identify the earnest-money amount, when it is due, and where it is to be delivered.
Do not assume the money can be sent whenever it is convenient.
Confirm:
- the amount
- the due date
- the party holding it
- the approved delivery method
- when the deposit has been received
Earnest money is part of the transaction, but it is not the same thing as your entire down payment or your final Cash to Close.
Schedule Inspections Early Enough to Use the Information
A general home inspection is often only the beginning of the property review.
The specific house should determine whether additional evaluation makes sense.
Depending on the property, that may include questions involving:
- sewer line
- roof
- foundation or structural movement
- electrical system
- plumbing
- HVAC
- radon
- moisture or drainage
- fireplace or chimney
- well or septic
- permits
- additions or finished basement work
- appliances or other included items
The goal is not to order every possible inspection.
It is to identify the questions that matter for this property while the applicable contract deadlines are still open.
Older Denver and Lakewood Homes
A sewer scope can be particularly useful when an older property has a buried line whose condition cannot be understood from the interior inspection.
If the scope finds root intrusion, a break, offset joints, deterioration, or another concern, the next question is not simply:
“Is the sewer bad?”
It is:
Where is the problem, what does it mean, what may it cost to address, and what does the contract allow us to do before the relevant deadline?
Finished Basements
A finished basement can add useful living space, but the buyer may still want to understand moisture history, egress, electrical work, plumbing, permits where relevant, and how the finished space relates to public records.
That applies whether you are looking at a Denver bungalow, a Parker two-story, or a South Metro home where a large portion of the usable space is below grade.
Roofs Along the Front Range
Roof age and visible condition matter, but so can insurability.
Colorado hail exposure means the buyer should not assume that an older roof is merely a future maintenance question.
The inspection, insurance quote, seller information, and available records may each answer a different part of the picture.
Get the Homeowners Insurance Quote Early
Do not wait until the week before closing to find out whether the property is expensive or difficult to insure.
For a financed purchase, your lender will generally require appropriate property insurance. But the buyer also needs to understand what the policy may actually cost and cover.
Ask about:
- annual premium
- wind and hail deductible
- roof-related terms
- replacement-cost assumptions
- wildfire considerations where applicable
- flood coverage if relevant
- other property-specific exclusions or limitations
Colorado's Division of Insurance provides homeowners insurance information and consumer resources.
The point is not to become an insurance expert during escrow.
It is to find out early enough whether the insurance picture changes how you evaluate the home.
Review Title, Covenants, and Association Documents
Title review and inspection answer different questions.
Inspection deals primarily with the physical property.
Title, covenants, and association materials can affect ownership, use, obligations, and what comes with the property.
Title
Review the title information provided for the transaction and raise questions before the applicable deadline.
Depending on the property, the documents may identify recorded easements, liens, restrictions, access rights, or other matters affecting title.
HOA or Community Association
If the property belongs to an association, do more than confirm the monthly dues.
Review the documents and information available for the specific community.
Questions may include:
- current dues
- special assessments
- association insurance
- maintenance responsibilities
- reserves
- parking rules
- rental restrictions
- exterior-change rules
- pet rules where relevant
- other restrictions that affect how you expect to use the property
A Denver condo, Highlands Ranch house, and Parker townhome can have very different association structures.
Do not assume one HOA works like another.
Condo Insurance Deserves Extra Attention
For a condo or some attached properties, understand the relationship between the association's master insurance policy and the coverage you need for your individual unit.
Association insurance does not automatically mean every loss or assessment affecting an owner will be paid by the association.
Ask the insurance professional handling your quote what you are responsible for covering.
Keep the Loan Moving While You Inspect the House
Preapproval was not the end of underwriting.
After you are under contract, the lender may still need updated financial documents, property information, appraisal results, insurance information, or explanations.
Respond promptly when the lender asks for something.
And before making a meaningful financial change, ask the lender whether it could affect the loan.
That can include:
- taking on new debt
- financing furniture or a vehicle
- opening or closing credit accounts
- moving large sums between accounts
- changing jobs or compensation
- receiving or transferring funds that need documentation
The Consumer Financial Protection Bureau advises buyers to respond quickly to lender requests for documents and information.
The practical rule is simple:
Do not make the lender discover a major financial change after you have already made it.
The Appraisal Is a Separate Part of the Transaction
If you are financing the purchase, the lender may require an appraisal.
The appraisal is not another home inspection. Its primary purpose in the loan process is to help establish the property's value for the lender.
What If the Appraisal Comes in Low?
Start with the contract you signed.
A low appraisal can create a difference between the contract price and the value used by the lender.
Depending on your contract terms, the available choices may involve additional cash, a price discussion, an objection or termination right, or another written resolution.
The Colorado Division of Real Estate explains the basic concept of an appraisal gap in a home purchase.
Do not assume a low appraisal automatically kills the transaction.
Do not assume you automatically have to bring the entire difference either.
The contract terms matter.
When Something Comes Up, Identify Which Deadline Controls It
This is one of the most important habits during escrow.
Not every problem belongs under the inspection provision.
A concern involving:
- physical condition
- title
- covenants
- HOA documents
- appraisal
- financing
- insurance
may fall under different parts of the contract.
Before deciding what to do, identify:
What did we learn?
Which part of the contract addresses it?
What is the relevant deadline?
What choices are still available?
That keeps a new problem from becoming a rushed decision.
Decide Which Problems Actually Matter to You
Inspection reports can be long.
Not every item deserves the same weight.
A missing outlet cover and a failed sewer line are both technically “inspection findings,” but they are not the same kind of decision.
Separate concerns into useful categories.
Safety or Major-System Questions
Electrical hazards, structural concerns, significant moisture, major plumbing problems, roof failure, sewer problems, or similar issues may deserve more investigation.
Near-Term Cost
Some items may not prevent you from buying the home but could require money soon after closing.
Maintenance
Every house has maintenance.
The existence of normal wear does not make a property defective.
Preference
Paint color, older finishes, dated fixtures, and similar items may affect what the home is worth to you, but they are different from a major condition issue.
The goal is not to make the seller deliver a new house.
It is to understand what you are buying before your contract choices expire.
Keep the Property and the Price Connected
Inspection discoveries can change how you see the value of the home.
But do not evaluate every repair by automatically subtracting its estimated cost from the purchase price.
A 1960s Denver ranch, a newer Central Park home, and a foothills property will not have the same condition profile.
Consider:
- age of the home
- price already negotiated
- condition of competing homes
- how soon the issue requires attention
- likely cost
- whether the condition was already visible or reflected in pricing
- whether you still want the property if nothing changes
Sometimes the right response is to request something.
Sometimes it is to gather more information.
Sometimes it is to accept the condition.
And sometimes the new information changes whether you want the house at all.
Confirm Your Cash to Close Before Closing Day
Your down payment is not necessarily the amount you need to bring to closing.
Your Cash to Close can also reflect closing costs, prepaid items, credits, deposits already paid, and other transaction-specific amounts.
Once the Closing Disclosure is available, compare it with your most recent Loan Estimate and ask questions about unexpected changes.
For many mortgage transactions, the lender generally must provide the Closing Disclosure at least three business days before scheduled closing.
The CFPB explains how to review the Closing Disclosure before closing.
Verify Wiring Instructions Before Sending Closing Funds
Wire fraud is a real closing risk.
Criminals can impersonate agents, title companies, lenders, or other transaction participants and send convincing instructions directing buyers to a fraudulent account.
Do not rely only on an email containing wiring instructions.
Before sending money:
- verify the instructions directly with the title or settlement company
- use a phone number you already trust
- be especially suspicious of last-minute changes
- confirm the amount and account information before initiating the wire
The CFPB specifically warns homebuyers about mortgage-closing scams involving fraudulent wiring instructions.
If wiring instructions suddenly change, verify them before doing anything.
Complete the Final Walk-Through
The final walk-through is not another full inspection.
It is your opportunity shortly before closing to confirm that the property is in the condition you expect under the contract.
Check things such as:
- agreed repairs
- items that should remain with the property
- property condition since the inspection
- whether the seller's belongings have been removed as expected
- obvious new damage or changes
CFPB includes the final walk-through as part of preparing to close.
If something is materially different from what you expected, raise it before signing rather than discovering it after closing.
Closing and Possession Are Not Always the Same Moment
Closing is when the transaction documents are signed and the purchase moves toward completion.
Possession is when the contract says you are entitled to occupy the property.
Those may happen at the same time.
They do not have to.
A seller may have an agreed period of post-closing possession, or another contractual arrangement may affect when you actually receive the home.
Before scheduling movers, deliveries, contractors, or a locksmith, confirm:
When does the contract say I get possession?
Do not assume “closing at 10 a.m.” automatically means “moving truck at noon.”
What Does “Escrow” Mean in a Colorado Home Purchase?
You may hear the word used in several ways.
After an offer is accepted, people commonly use escrow to describe the period between contract and closing while earnest money, inspections, title, financing, and other transaction work is underway.
You may also hear escrow used more specifically in connection with money or documents being held by a neutral party, the title and closing process, or an escrow account maintained by a mortgage servicer after closing for taxes and insurance.
The Colorado Division of Real Estate discusses escrow as part of the state's real estate transaction process.
You do not need to memorize every use of the term.
During the purchase, the important question is:
What happens next, and when is it due?
Common Questions While You Are Under Contract
My Inspection Found Something. What Happens Now?
First understand the issue well enough to make a decision.
That may require an estimate, specialist evaluation, sewer scope, engineer, roofer, electrician, plumber, or another qualified professional depending on the concern.
Then identify the relevant contract provision and deadline.
Do not let the time needed to investigate the problem consume the time you have to respond to it.
Can I Still Cancel After My Offer Is Accepted?
Possibly, depending on the contract and the circumstances.
A Colorado purchase contract can contain separate provisions and deadlines involving inspection, title, financing, appraisal, association documents, and other matters.
Whether you have a right to terminate at a particular point depends on the signed contract.
When Should I Get Homeowners Insurance?
Start early in the contract period.
Waiting until shortly before closing can create unnecessary problems if the premium, deductible, roof terms, wildfire considerations, or another underwriting issue changes the affordability or insurability of the property.
What Happens If the Appraisal Is Below the Contract Price?
Review the contract terms that apply to appraisal.
The options can differ depending on the agreement you signed. A low appraisal does not automatically mean either that the transaction ends or that you must pay the entire difference in cash.
Why Is My Lender Asking for More Documents After Preapproval?
Because preapproval is not final underwriting approval.
Once a property is under contract, the lender continues verifying the borrower, property, loan conditions, insurance, appraisal, and other information needed for the mortgage.
Respond quickly and ask questions when a request is unclear.
When Will I Know My Exact Cash to Close?
The number becomes more precise as the transaction progresses.
Your lender's Loan Estimate provides an earlier estimate. The Closing Disclosure provides the later transaction figures you should review before closing.
When Should I Send My Closing Funds?
Follow the verified instructions from the title or settlement company handling your closing.
Do not wire funds simply because an email tells you to, especially if the instructions changed unexpectedly.
Verify first.
Is Closing Day When I Get the Keys?
Often, but not always.
Check the possession terms in your contract before planning the move.
Keep the Next Decision in Front of You
Once you are under contract, several parts of the purchase move at the same time.
You do not need to anticipate every possible problem.
You need to know:
- the next deadline
- what information is needed before it
- which questions are still unresolved
- who is handling each task
- what decision you may need to make
That is how you move through escrow without losing track of the choices that still matter.
Ask About a Contract Deadline or Property Issue
Already under contract on a Colorado home?
Tell us what happened and which part of the transaction you are trying to understand.