So, it’s finally happened: you’ve found the home you want to purchase. The next step in the process is to decide how much you want to pay for it and get a signed offer to purchase to the seller.

While every single line in the purchase agreement is important, some are more critical to understand before signing.

Let’s take a stroll through some of these, in one of the most important contracts you’ll ever put your signature to.

Earnest Money Deposit

The earnest money deposit is the amount of money you’ll be giving the seller when you submit your offer to purchase (or shortly after it is accepted) to show you are serious. Don’t confuse this with the down payment, which is a lender requirement.

The amount varies, but 1 percent is typical. This money is kept either in the broker’s trust account or with the title company. If the seller accepts the offer, the earnest money will be applied to the purchase of the home.

Personal Property

Anything that is not permanently attached to the home is considered personal property and sometimes this property is included in the sale. If so, it will be listed in the purchase agreement or in a separate addendum.

Items of personal property commonly included in home sales include:

• Appliances
• Yard equipment
• Furniture

Closing Date

There are different schools of thought on how to strategically choose a closing date. Some people feel it’s best to close escrow as late in the month as possible. This is because prepaid interest, which you’ll need to pay at closing, is prorated from the date of closing to the end of the month.

If you are cash-flow conscious, on the other hand, you may want to close escrow early in the month. Your prepaid interest charge will be higher but, because mortgage interest is paid in arrears, you will skip two mortgage payments instead of one.

That said, there are some times that are better for closings, for various reasons:

• Avoid closing escrow near the fall and winter holidays, especially Thanksgiving, Christmas Eve or New Year’s Eve. Real estate professionals (agents, lenders and title reps), like folks in all other businesses, take time off to be with friends and family.

• If you are both selling and buying you may need a simultaneous close, allowing both escrows to wrap up on the same day. This is a delicate process and it does have its shortcomings, which I can explain to you if you are in this situation.

A real estate agent worth his or her salt will walk you through the purchase agreement, line-by-line to ensure you understand what you’re signing. Never sign the contract unless you do.