Make sure you know exactly what you’re getting or giving when you sign on the dotted line.
1. Give yourself time to get a loan
Many contracts are contingent upon the buyer getting financing by a certain date. In today’s tough lending climate, buyers are wise to allow themselves plenty of time to get approval for a home loan. If the date passes and no financing is secured, the sellers may terminate the contract and keep the earnest money deposit.
“You should also be realistic about your closing date,” says Patti Lawton, a broker with Welcome Home Realty in Brunswick, Maine. “Don’t try to close too quickly. There are a lot of things that need to be done properly, and you must give lenders, title companies and others time.”
2. Be specific about which items stay with the house
You’ve likely heard the story of the buyer who walked into a new home only to discover that the refrigerator and chandeliers were missing. Check the contract.
As a seller, be sure you specifically state on the contract what will stay with the home.
As a buyer, pay attention. Don’t assume that the Sub-Zero refrigerator is yours once you close.
3. Know the effective date
Surprise: The contract doesn’t always take effect on the day you sign it.
“In every contract, there are things that must be done within X number of days from the effective date: inspections, loan applications and approval, title searches,” Marks says. “If you don’t know the date that the contract went into effect, you may not have a valid contract.”
4. Get everyone to sign
“Sometimes the home is owned by both spouses, other owners or an entity such as a corporation,” Marks says. “Make sure all of the parties sign the contract. If a party to the transaction fails to sign, (that party is) not bound to perform the contract.”
Buying a house is one of the biggest financial decisions you’re going to make. Simply, “Take it seriously and make sure everything that’s important to you is in writing,” Lawton says.