Whether you are handling the sale of your home alone or with an agent, it is important that you become familiar with legal issues you could face. Sure, working with an experienced agent does relieve your shoulders from carrying many legal burdens, but it is still your responsibility to be educated about the topics on this checklist.
1. Understand Everything Outlined in the Agreement of Sale
This contract is one of the most important documents of your real estate sale. Make sure you understand every detail on it before you sign. A wide variety of provisions may be included, such as:
How much earnest money has been paid, and what are the terms, if your buyer backs out?
What additional items are included in the sale (appliances, light fixtures, outdoor fountains, etc.)?
What inspections are needed?
Who is responsible for covering the cost of repairs to address failed areas of inspections?
Who will pay local or state deed transfer taxes and other fees?
2. Know What Documentation You Need
Gather all the documents you need and keep them in a file so they are ready when you need them. A few items that should be included are:
Documents for damage, improvements, and major repairs
Agreements between seller and real estate agent
Comparable sales in your selling area
Agreements made between you and tenants or co-habiting partners
Evidence of liens, judgements, and encumbrances
3. Discuss Financial Details with Domestic Partners
If you are in an unmarried relationship, it is important to discuss profit division with your domestic partner. You may be interested to learn that some countries have laws granting ownership and property rights to such partners. Included parties need to come to some type of agreement about profit division. Once you do, have a home sale agreement drafted by a real estate attorney.
4. Know Your Options Based On Your Ownership Structure
If you are not the sole owner of the home you are selling, there is not a lot you can do without an agreement from the other involved parties. This means that a disgruntled person going through a divorce can’t sell the house without their spouse signing to transfer the deed. This same rule applies to inherited properties.
5. Resolve Major Debts
Whether you have old tax liens, civil court judgements, or missed child support payments debts, liens, and encumbrances, they need to be resolved before selling the home. Contrary to popular belief, selling a home with a lien or debt attached to it does not mean the problem will go away. One way or another lien holder will get its money.
From creating a listing price to giving your home a facelift to surviving the closing process, there is a lot of stress involved with selling a home. Learning about legalities may seem like you will just be overwhelming yourself with even more information, but being educated about these topics will actually help you have a more enjoyable and less stressful experience.