Buying a home is likely the largest financial transaction that we make in our lifetime. If we are lucky, we get one that fits our needs and provides an opportunity for financial stability. We can help to better ensure this is the case by knowing some of the basics about real estate contracts before we buy our home in the first place.
Three things that every home buyer should know before they finalize their purchase include:
#1: Conditions may benefit the seller.
Depending on the terms of the contract used to make the offer, it may have conditions that benefit the seller — possibly at a determent to the buyer. Some examples to look out for include an “as-is” clause. This provision basically states that buyer purchases the property in its current condition. Essentially, it means the buyer will not be able to hold the seller responsible for any problems with the property after the sale is complete. Leaky roof or problems with a septic system? Once you sign off on an “as-is” agreement, the problem is now yours.
#2: Closing costs can come with surprises.
This provision will outline what part of the closing the seller pays for and what the buyer will cover. Take the time to carefully review these expenses to reduce the risk of a surprise at the closing. Common fees that are dealt with during the closing process can include escrow fees and recoding fees as well as the cost of a title search and title insurance.
#3: The contract is negotiable.
You do not have to simply use a fill-in-the-blank or boilerplate contract. You can negotiate and adjust the contract to make sure it has the terms and conditions that work for you.
