What woooee said was correct:

overwrite=""
while(overwrite!="Y".lower() and overwrite!="N".lower()):
overwrite=raw_input()

Try:

import time

response=raw_input("Are you ready?\n")

while(response.lower()!="no"):
if(response.lower()!="yes"):
time.sleep(3)
response=raw_input("\nAre you...