When selling a home, the escrow process can be one of the most daunting tasks for homeowners. The escrow process is the period of time between the acceptance of a purchase agreement and the closing of the sale. During this period, the buyer and seller will work to complete all the necessary steps to transfer ownership of the property. While this process can take a long time with a traditional MLS listing, things are much faster with a direct sale to Northwoods Property Resources.
In this blog post, we’ll walk you through the typical steps of the escrow process and what homeowners can expect when selling a home in Milwaukee. We’ll also discuss how a direct sale to Northwoods Property Resources can make the process much faster and less stressful.
Step 1: Opening Escrow
The first step in the escrow process is opening escrow, which officially marks the transition from an accepted offer to the finalization of the sale. In Milwaukee, escrow is typically managed by a title company or an attorney specializing in real estate transactions. The buyer’s real estate agent or attorney will submit a copy of the signed purchase agreement to the escrow company, along with the buyer’s earnest money deposit—usually 1% to 3% of the purchase price.
Once escrow is opened, the escrow officer will create an official file, review contract terms, and issue detailed instructions to both parties outlining the steps needed to close the transaction. These instructions may include providing mortgage approval documents, homeowner association disclosures (if applicable), and a preliminary title report. Sellers should be prepared to respond to any title-related concerns promptly to avoid unnecessary delays.
Step 2: Title Search and Insurance
The next step in the escrow process is conducting a title search and obtaining title insurance. This is important to ensure that the title of the property is clear and that there are no liens, encumbrances, or other issues that could prevent the sale from going through. The escrow company will work with a title company to perform the search and obtain the insurance.
Step 3: Home Inspection and Repairs
After the title search and insurance have been completed, the buyer will typically schedule a home inspection to assess the condition of the property. In Milwaukee, common issues that arise during inspections include foundation cracks due to freeze-thaw cycles, outdated electrical systems in older homes, and roof damage from heavy snow accumulation. The inspector’s report will outline necessary repairs, and the buyer may request that these be addressed before proceeding with the sale.
Sellers have a few options when dealing with inspection-related repairs. They can choose to fix the issues, offer a credit to the buyer to cover the cost, or negotiate for an “as-is” sale. However, Wisconsin real estate law requires that sellers disclose known defects upfront, even in as-is sales. If significant repairs are needed and the buyer backs out due to an inspection contingency, the seller may have to relist the property and go through the escrow process again. Working with an experienced real estate agent or attorney can help sellers navigate these situations effectively.
Step 4: Appraisal
After the necessary repairs have been made (if required), the buyer’s lender will order a professional appraisal of the property. In Milwaukee, licensed appraisers assess home values based on recent comparable sales (comps), market trends, and the home’s overall condition. Since Milwaukee has a mix of historic and newly constructed homes, appraisals can vary significantly depending on neighborhood factors, renovations, and local demand.
The appraisal is crucial because lenders will not approve a mortgage for more than the property’s assessed value. If the appraisal comes in lower than the agreed-upon sale price, it can create a financing gap that needs to be resolved. In this case, the buyer may need to increase their down payment, the seller may need to lower the sale price, or both parties may renegotiate terms. In some cases, a second appraisal can be requested, but this is not always guaranteed to yield a different result. Sellers should be aware of market conditions to price their homes competitively and reduce the risk of appraisal issues derailing the transaction.
Step 5: Contingencies
Contingencies play a significant role in the escrow process, serving as protective clauses for both buyers and sellers. A contingency is a specific condition that must be fulfilled before the sale can be finalized. Common contingencies include:
- Financing Contingency: The sale is dependent on the buyer securing mortgage approval. If the buyer is denied financing, they can back out without penalties.
- Inspection Contingency: If a home inspection reveals significant defects, the buyer can request repairs, renegotiate the price, or withdraw from the deal.
- Appraisal Contingency: If the appraised value is lower than the agreed price, the buyer has the option to renegotiate or cancel the purchase.
- Sale of Buyer’s Property Contingency: In some cases, a buyer may need to sell their current home before finalizing the new purchase.
In Milwaukee, real estate contracts often include earnest money protections, ensuring that if a buyer backs out due to a valid contingency, they can recover their deposit. However, sellers should carefully review contingency deadlines, as delayed resolutions can push back the closing date. An experienced real estate agent or attorney can help navigate these complexities to keep the sale on track.
Step 6: Closing
Once all the steps of the escrow process have been completed—contingencies cleared, financing secured, and final walkthrough completed—the sale can officially close. This is the stage where ownership of the property is legally transferred from the seller to the buyer, and all outstanding fees and costs, including escrow fees, title fees, and any agreed-upon closing costs, are settled.
In Wisconsin, closing typically takes place at a title company or attorney’s office, where both parties sign the necessary legal documents. The escrow company or closing agent will ensure that all required paperwork—such as the deed transfer, loan documents, and tax declarations—is properly executed. Once this is completed, the funds are distributed accordingly. Sellers should be aware that in Wisconsin, property tax payments are prorated at closing, meaning they may need to provide a credit to cover unpaid property taxes up to the date of sale.
After closing, the buyer officially takes possession of the home, and the seller receives the final proceeds. For sellers working with a real estate agent, commissions will be deducted from the sale amount. Those opting for a direct cash sale should verify that all payment terms are clearly outlined in writing to avoid any last-minute complications.
As you can see, the escrow process can be lengthy and stressful for homeowners. However, there is a faster and less stressful option available – a direct sale to Northwoods Property Resources.
Why Choose Northwoods Property Resources?
With a direct sale to Northwoods Property Resources, homeowners can bypass the traditional escrow process, avoiding potential delays from inspections, financing approvals, and contingencies. Instead of waiting 30 to 60 days for escrow to close, sellers receive a direct cash offer and can close the sale within days.
This can be especially beneficial for homeowners facing foreclosure, needing to relocate quickly, or dealing with inherited properties they don’t want to manage. However, while the speed and convenience of a direct sale are appealing, sellers should carefully evaluate offers to ensure they receive a fair market price. Direct sales often result in offers below full market value, as investors factor in repair costs and their own profit margins.
To make an informed decision, sellers should compare the net proceeds of a traditional sale (after commissions and closing costs) versus a direct cash offer. Reviewing multiple offers, seeking advice from a local real estate attorney, and verifying the legitimacy of the buyer can help ensure a smooth and fair transaction. For homeowners looking for certainty and efficiency, Northwoods Property Resources offers a streamlined alternative—but like any real estate decision, it’s important to weigh all options carefully.
In addition, a direct sale to Northwoods Property Resources offers several other benefits. For example, you can avoid the need to make repairs to your property or stage it for showings. Northwoods Property Resources will buy your property as-is, regardless of its condition. This can save you time and money and make the process much more convenient.
Another benefit of a direct sale to Northwoods Property Resources is that sellers can bypass real estate agent commissions and associated listing fees. In a traditional sale, sellers typically pay 5% to 6% in agent commissions—3% to the buyer’s agent and 2% to 3% to their own agent. On a $250,000 home, this amounts to $12,500 to $15,000 in fees.
Additionally, MLS listings often come with extra costs such as home staging, photography, and marketing expenses, which can add another $1,000 to $3,000 to the seller’s budget. By selling directly to Northwoods Property Resources, homeowners can eliminate these costs entirely.
However, while a direct sale provides savings on commissions, sellers should also consider the potential trade-off in sale price. Direct buyers, including investors, often purchase properties below full market value to account for repairs and resale profits. Homeowners should compare the net proceeds of a direct sale versus a traditional listing to ensure they are making the best financial decision. Consulting a real estate professional or attorney can provide clarity on the true financial impact of either choice.
Finally, a direct sale to Northwoods Property Resources offers certainty and peace of mind by eliminating many of the variables that can cause traditional home sales to fall through. In a conventional sale, deals often fail due to loan denials, low appraisals, or unresolved inspection issues. A cash sale removes these concerns, as there’s no lender involvement, and buyers typically accept the property in its current condition.
That said, sellers should be aware that direct sales do not include the same legal protections as traditional escrow transactions. Since escrow companies act as neutral third parties to ensure all conditions are met, bypassing escrow requires trusting the buyer to uphold their end of the deal. Homeowners considering a direct sale should request a written purchase agreement, verify proof of funds, and, if possible, consult a real estate attorney before signing any contracts.
Whether choosing a traditional sale or a direct sale, Milwaukee homeowners should weigh the pros and cons carefully. Each method has its advantages, and the best choice depends on the seller’s unique financial situation, timeline, and property condition.
The escrow process can be a stressful and time-consuming experience for homeowners. However, there is a faster and less stressful option available – a direct sale to Northwoods Property Resources. With a direct sale to Northwoods Property Resources, you can avoid the uncertainty and stress of the traditional escrow process and get cash for your property quickly. If you’re looking to sell your property in Milwaukee, contact Northwoods Property Resources today to learn how we can help you. (920) 851-9727