On this episode of Real Estate Insights with the Freud Group, John goes over the more of the real estate contract.
5. Earnest Money- This is money given and deposited to the title company basically giving the seller a good faith that you have a vested amount of interest in the property and as the buyer you know you may lose this money if the buyer doesn’t obtain financing approval in the days allotted or other time frames. The earnest money is typically 1% of the sales price. The buyer will receive credit at closing for the earnest deposited.
6. Title policy and survey- Title policy ensures clear title of the property and if there is a lien or judgement that is not caught the title company insures the property for the buyer. Look at our video and blog about title insurance.
Survey- A drawing of the property showing where the property lines are, any encroachment, easements or improvements such as a pool. There may an existing survey that may be approved, the seller may pay for a new survey or the buyer will pay. These are all items negotiated at time of the contract being signed.
E. Title notices: Advising buyer to have an abstract of title, whether a cash buyer or not. HOA- Obligations of the payment of the associations.
MUD, PID, Districts. (John explains more about each)
7. Property condition: Talks about buyer having inspections, seller’s disclosure notice.
Lead Based paint. If property is built prior to 1978 the seller has to fill out a form giving any knowledge to if the home has lead based paint.
Property condition and acceptance. Are there any repairs required in addition to repairs requested after the inspections?