Escrow, Inspections, and Appraisals: What San Antonio Home Sellers Need to Know When Selling Their Home
Navigating the Under-Contract Phase
Congratulations—you've accepted an offer! But the sale isn't final yet. Between contract acceptance and closing, several critical steps must be completed: the option period with inspections, the appraisal, title work, and final preparations for closing.
This "under-contract" phase typically lasts 30-45 days and involves coordination between multiple parties—buyers, agents, lenders, inspectors, appraisers, and title companies. Understanding what happens during this phase helps you navigate it smoothly and avoid surprises.
The Texas Option Period
What Is the Option Period?
In Texas, buyers typically negotiate an "option period" (usually 7-10 days) during which they can terminate the contract for any reason and receive their earnest money back. The buyer pays a small, non-refundable option fee (typically $100-500) for this right.
This is the buyer's "due diligence" period when they conduct inspections, verify property condition, review HOA documents, and confirm they want to proceed.
What Happens During the Option Period?
Home Inspection
Professional inspector evaluates the property's condition—roof, foundation, HVAC, plumbing, electrical, structural components, and more. Inspections typically take 2-4 hours.
Specialized Inspections (if needed)
✅ Foundation inspection (common in San Antonio due to soil conditions)
✅ Roof inspection
✅ HVAC inspection
✅ Pool/spa inspection
✅ Pest/termite inspection
✅ Septic system inspection (for homes not on city sewer)
Your Role During Inspections:
✅ Provide access to the home (including attic, garage, exterior)
✅ Ensure utilities are on (inspector needs to test systems)
✅ Secure pets
✅ Plan to be away during inspection (2-4 hours)

After the Inspection on Your San Antonio Home
Buyers typically receive a detailed report listing everything found—from major issues to minor maintenance items. Not everything in the report is a problem requiring action.
Possible Outcomes:
Buyer Terminates During Option Period: If buyer finds significant issues or simply changes their mind, they can terminate during the option period and receive earnest money back. This is uncommon but possible.
Buyer Requests Repairs or Credits: Most common scenario. Buyer submits repair amendment requesting you fix specific items or provide credit at closing for repairs.
Buyer Proceeds Without Repair Requests: Less common but happens with cash buyers, investors, or buyers purchasing "as-is."


The Appraisal Process
What Is an Appraisal?
If the buyer is financing the purchase, their lender orders an independent appraisal to confirm the property value supports the loan amount. The appraiser evaluates your home and compares it to recent comparable sales to determine market value.
Appraisal Timeline: Typically ordered within 7-10 days of contract execution, completed within 7-10 days of order, report delivered to lender within days.
What the Appraiser Evaluates:
✅ Recent comparable sales (similar homes sold in past 3-6 months)
✅ Property size, layout, condition, and features
✅ Location and neighborhood characteristics
✅ Lot size and outdoor amenities
✅ Upgrades and improvements
✅ Overall market conditions
Appraiser Access: You'll need to provide access (typically 30-60 minutes). Home should be clean and accessible, with all areas available for viewing.
Appraisal Outcomes:
1. Appraises at or Above Contract Price ✅
Most common outcome. Sale proceeds as planned.
2. Appraises Below Contract Price ⚠️
Less common but creates negotiation opportunity.
Low Appraisal Scenarios
Why Appraisals Come in Low:
✅Contract price negotiated above market value (often in multiple offer situations)
✅ Limited recent comparable sales in the area
✅ Market conditions changed between contract and appraisal
✅ Appraiser used questionable comparables or methodology
✅ Property condition issues noted by appraiser

Your Options When The Appraisal Is Low
Option 1: Reduce Price to Appraised Value
You accept the lower price. Buyer proceeds with original financing terms at the appraised value.
Option 2: Buyer Makes Up the Difference
Buyer brings additional cash to closing to cover the gap between appraisal and contract price. Only works if buyer has extra cash available.
Option 3: Negotiate a Compromise
Split the difference—you reduce price somewhat, buyer brings extra cash to closing for the remainder.
Option 4: Challenge the Appraisal
If we believe the appraisal used poor comparables or missed key property features, we can provide additional comparable sales data to the lender and request reconsideration.
Option 5: Terminate the Contract
If neither party will budge, the deal may fall apart. Buyer gets earnest money back (if appraisal contingency exists), and you relist the property.
Our Strategy for Low Appraisals:
With roughly 1,000 transactions of experience, we've handled numerous low appraisal situations. We'll:
✅ Review the appraisal report for accuracy and methodology
✅ Provide additional comparable sales data if warranted
✅ Evaluate your position based on market conditions and alternative options
✅ Negotiate strategically to preserve the deal while protecting your interests
✅ Help you make informed decisions about price adjustments vs. remarketing
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