The two processes run in parallel and depend on each other. Sequencing them so neither delays the other.
A property purchase and its financing run as two processes with dependencies in both directions. Most transaction delays occur where one waited for the other unnecessarily, which is avoidable with sequencing.
Before stage one
Before making an offer, financing should be arranged in principle, since an offer made without it either delays or collapses when the financing is assessed.
- Financing indication obtained with its conditions understood.
- Documentation assembled for the formal application.
- Advisers identified so no step waits while you find one.
- The deposit and transaction costs available rather than committed elsewhere.
Stage 1: Obtain the indication before searching
Establish what is available to you, on what terms and subject to what conditions.
- Deliverable: An indication with conditions stated.
- Owner: Buyer.
- Approval gate: Search budget set from the indication rather than from hope.
Stage 2: Make the offer with financing understood
Offer on the property with an accurate understanding of the timetable financing requires.
- Deliverable: An offer with realistic conditions and timing.
- Owner: Buyer.
- Approval gate: Timetable reflects the financing process rather than assuming it is instant.
Stage 3: Run due diligence and the application together
Begin title verification and inspection while the formal financing application proceeds.
- Deliverable: Both processes advancing in parallel.
- Owner: Buyer with advisers.
- Approval gate: Neither waiting for the other where they can run concurrently.
Stage 4: Manage the valuation
Facilitate the financier's valuation promptly, since it is frequently on the critical path.
- Deliverable: Valuation completed.
- Owner: Buyer with the financier and seller.
- Approval gate: Access arranged quickly, since delays here delay everything.
Stage 5: Reconcile findings across both processes
Where inspection findings or a valuation shortfall arise, address them in the transaction before completion.
- Deliverable: An adjusted position reflected in the contract.
- Owner: Buyer.
- Approval gate: Findings resolved before completion rather than absorbed afterwards.
Stage 6: Complete
Satisfy the remaining conditions and coordinate funds release with the transfer process.
- Deliverable: Completed purchase with financing in place.
- Owner: All parties.
- Approval gate: Funds released in line with the transaction rather than ahead of it.
Handovers between stages
The dependency that causes most delay is the valuation, which requires access from the seller, action by the financier and follow up from you. Arranging it promptly removes the most common single source of delay in a financed purchase.
How you know it is finished
The coordination has worked when completion occurs without either process waiting for the other, the findings from due diligence are reflected in the terms, and the financing is in place on the conditions you understood at the outset.
If you are weighing a financing decision, Domira can review the offers, model the total cost and stress test the obligation with you before you sign anything.
Frequently Asked Questions
Should an offer be conditional on financing?
Where the practice allows it, a condition protects you if financing is not obtained on the expected terms. Where it is not customary, the protection comes from arranging financing in principle before offering, so the risk is smaller to begin with.
What if the valuation is below the agreed price?
The amount available reduces, and the shortfall must be funded from your own resources or the price renegotiated. Knowing this possibility in advance is why a reserve beyond the deposit matters during a financed purchase.
Can I change financier during a transaction?
It is possible and it restarts parts of the process, including potentially the valuation, which usually delays completion. This is the practical argument for comparing offers before making an offer on a property rather than during the transaction.
Have a Property Question?
Domira can help you navigate property, financing and investment decisions in Saudi Arabia. Speak with our team for an initial consultation.
