Rest assured, there is always a lot of paperwork!
It can seem tedious, but it is important to understand what the paperwork is all about!
You may already know about or expect paperwork needed to apply for and secure a loan. But there are additional things to be aware of even if you do not need a load.
The following is a list of some of these items to expect. This is not necessarily an exhaustive list, but these are common items you’ll want to be aware of.
Paperwork:
- Seller disclosures concerning condition of the property
Sellers are required to fill out a form that identifies any problems with the condition of the house, especially things that may not be obvious at first glance. Examples can include water damage, material defects, etc.
As the buyer, you review and sign off on that document to indicate you are aware of the disclosures.
- Seller disclosures concerning radon, lead, mold
Any knowledge that a seller has of possible contamination from radon, lead, or mold may also be included in a set of disclosure documents that a seller makes available. Buyers review and sign these also as part of the buying process.
The lead disclosure is only needed for houses older than 1978 because after that year, lead paint was not allowed.
- Contract for property purchase (that you and a seller both sign)
This is the document that you use to make an offer on a house, and once all parties sign off and agree on terms, it is the contract for your purchase.
This is an extensive document and one that you will want to review in detail with your broker so that you fully understand all items in the contract and what they mean. You will also want to understand all the dates and timelines involved so that everything gets done in a timely fashion up to the closing.
- Land survey documents
These are official documents that lay out the details of the property boundaries and easements etc. They are especially important when you desire to add onto a property after you buy it because there may be limitations to what you can actually do legally with the property. You will want to understand any restrictions before you make an offer.
- Home association rules and regulations (if applicable)
This is applicable only in cases where the property is part of a group of homes or units that all share something in common such as a common area, or security gates, etc. Monthly fees to pay for shared services are typically required of you when you buy into these properties. In addition, there may be restrictions that you need to be aware of. For example, perhaps pets are not allowed, or perhaps if you want to paint the exterior, you have to choose from a set palette of colors.
- Illinois buyer agency agreement contract – a Contract between a buyer and a real estate broker working on a buyer’s behalf
This contact is used by some brokers, which they want their “buyer” clients to sign. It is a contract whose purpose is to make sure the broker ultimately gets compensated if the buyer ends up buying a house within the contract period.
The reasoning behind this contract is that a broker may spend many hours helping a client find houses and see them, etc. But they are not paid for this effort unless or until an actual sale goes through.
So here is a possible scenario. Assume Broker A helps a buyer find and go visit many houses, but none end up in a sale. Then at some point, the buyer finds a house they actually buy, but the buyer ended up using a different broker – Broker B – to go look at that house. And they end up having Broker B to be their representative on that sale.
No matter how much harder Broker A worked to help this client, Broker B would be the only broker who got ultimately paid for any of that effort. The agency agreement contract is a vehicle for avoiding that sort of situation.
NOTE: the buyer agency agreement contract is not a document that a buyer is ever obligated to sign in order to buy a house. However, some agents or brokers may insist on it and might not work with a buyer who will not sign it.
Questions?
Remember – do not be shy about asking help from your real estate agent or broker to fully understand any paperwork you get, and the impacts of what you sign.
Contact us – we would love to help you understand more!