Didn’t they tell us years ago that we’d be a “paperless society” in the near future? Somebody forgot to tell the real estate industry. There must be a form for every single step in the selling process.
In all fairness, real estate is fully in the 21st century, with online document signing and other tech wizardry.
Still, the amount of paperwork you’ll sign, whether digitally or in hard form, from listing to close, is amazing. One thing is for sure, you’ll never, ever forget how to sign your name after this!
While every form I put in front of you for your signature is important, I thought we’d take a look at those that most of my selling clients have questions about.
An addendum – why should I care?
An addendum is something that is added to the real estate purchase agreement (REPC) before it becomes officially valid, but it is also used here in Utah to make an addition to or change in the contract after acceptance.
If you were performing a short sale, for instance, I would provide the buyer with a short sale addendum before we accept the offer from a buyer. Although a separate form, it will become part of the contract.
Addendums are not uncommon and they are used for everything from resolving repairs (after the home inspection results come in) to changing the closing date.
Contract deadlines protect the buyer’s earnest money and are outlined in the REPC. In Utah, they are the Seller Disclosure Deadline, Due Diligence Deadline, the Financing, and Appraisal deadline and the Settlement Deadline.
There is always a date attached to these contract deadlines, and anything that needs to be resolved in the due diligence must be taken cared of by that date, or the buyer’s ability to have their earnest money refunded is in jeopardy. This also applies respectively to the other dates, or the buyer is in violation of the contract’s terms.
There are seller responsibilities too. The most common has to do with supplying the buyer with the homeowner association documents by the seller disclosure date.
Contingency release form
A contingency is, simply, a condition. Think of the buyer as saying “I will buy your home if X comes to pass by THIS DATE.”
Although at first blush they may not seem like it, disclosures are your friend.
By law you must disclose certain things about your home to the buyer. That one is the most important disclosure. There are, however, others that you’ll need to understand.
I’ll give you an agency disclosure, for instance. This form simply discloses (makes known) our relationship and discloses to both you and the buyer that I am working for you.
The buyer’s agent will also submit an agency disclosure telling us that he or she represents the buyer.
The most important disclosure, as mentioned above, is the property condition disclosure. This is typically filled out by the homeowner when the home is listed.
It details just about everything that could be wrong with the home, the neighbors and the neighborhood.
You are required to disclose everything you know about the home that may materially affect the home’s value and the buyer’s enjoyment of the house.
It may seem you are sabotaging your sale by telling the buyers negative things about the house and the neighborhood, but you are actually protecting yourself from costly litigation in the future.
If you have any questions about disclosure requirements here in Utah, please ask. I’m happy to walk you through them.
NOTE: Never sign any forms during the listing and sale process that you don’t understand.
Although I am not an attorney and cannot give you legal advice, I can explain the meaning of each form that I put in front of you for your signature.
And, you are always welcome to run everything by your lawyer.
Now, let’s get that home sold!
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