1. Be Careful When Letting A Buyer Assume Your Mortgage
If you do, you could remain responsible if the buyer defaults. This could cost you thousands of dollars if the bank repossesses the house and sells it at a loss. If you can’t avoid allowing the assumption of your mortgage, make sure that the agreement provides for you to be completely released from your obligations on closing.
2. Don’t Lead The Buyer To Believe That You Have An Up-To-Date Survey
Unless you just moved into your house in the last few months, your survey might not be considered to be up-to-date. You might end up paying for a new survey to be produced for the purchaser. The best procedure is to agree to produce an existing survey and possibly even attach it to the agreement, if it is an important factor to the buyer, so there are no misunderstandings. Make sure that the clause regarding the survey does not suggest that it be suitable for mortgage financing as not all surveys are.
3. Don’t Make Any Assumptions About Paying Out Your Mortgage
Each bank has its own policies about how to calculate mortgage penalties and you could be surprised at the cost of paying out your mortgage early when you sell your property. It is always best to ask your bank to determine any discharge penalties applicable to your specific mortgage, that way you can avoid any surprises down the road.
4. Make Sure You Have Your Own Representation
This has the potential to create a conflict of interest. Make sure you have your own real estate lawyer and, if possible, a real estate professional working solely for your best interests! If any sort of dispute arises, you will have someone to advocate your position.
5. Be Careful Providing A Survey
If you are selling and have a survey, be careful as it may no longer be up-to-date if you had a swimming pool built, an addition added, or too much time has passed since the survey was prepared. If your survey is not up-to-date, the buyer may request an updated survey and you may be required to bear the cost to have a new survey prepared. The cost for this process typically runs anywhere from $700 to $1,000. This is $700-$1,000 less that you will net for your home but it might be the issue that decides the success or failure of sale. It is up to the buyer and the buyer’s lawyer to decide if the survey is acceptable.
Your real estate lawyer should be able to advise you appropriately when dealing with this issue. It is always best to consult with your lawyer before you sign the offer, or have the offer conditional upon your lawyer reviewing the documentation and approving it in his sole and absolute discretion. Don’t be afraid to take this important step, as thousands of dollars could be riding on the decisions you make at this point.
6. Selling A Home With A Swimming Pool
If the home you are selling has a swimming pool, there should be a specific legal clause which addresses this costly item. Some contracts are written to provide a warranty to the pool to survive closing. The broadness of this wording protects buyers, but is not necessarily in the best interest of sellers who might instead request that the clause be worded to indicate that, at the time of closing, they believe the pool to be in good working condition.
The existence of a pool in any home negotiation is certainly reason enough to ensure that you seek advice from a real estate lawyer so that your interests are represented properly. By being aware of these and other legal issues, and by seeking advice from an experienced real estate professional and obtaining legal counsel, you can protect yourself against unnecessary cost and potential hardship.
If you think that there is a possibility that your home will be sold after your pool is closed and before it is opened for the next season, you may want to invest in an inspection and closing by a professional pool company. This way you will have an objective, third party opinion of the condition of the pool that can be provided to the buyer. Don’t forget to take lots of photos before the pool is closed.