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What 3 Critical Legal Errors Will You Make - and How Can You Avoid Them?
Which one of these legal mistakes will you make?
When Austin Texas Real Estate MLS listings are bought and sold, there is quite a bit of your money at stake. Because of this, you need to pay attention to even the most subtle legal details as an Austin home Seller. Discover why selling your home can become a legal headache below. For more information see our home page.
Don’t take any chances!
Legal Error #1 - Not Disclosing Everything
It’s your job as a home Seller to disclose everything you know about the house to the person buying your home. If the deal falls through, it falls through. It doesn’t matter in comparison to the massive legal nightmare you could be in - if you don’t disclose everything, and the Buyer slaps you with a lawsuit after you close on the house! Yes. It's possible - and happens VERY frequently! So, what specifically do you need to disclose?
First, you must use a Property Disclosure Form and list any problems the home has. Then, you should point out any repairs that need to be made, as well as any repairs you made.
Next, you are 'wise' to disclosure any repairs, remodeling improvements or additions that were made - that building permits were NOT pulled. You'll get all this in writing on the Property Disclosure Form and have the Buyer sign off on it. This will protect you down the road and ensure a 99.9% worry-free sales transaction. When the Buyer does their home inspection on your property, then this usually removes the other .1% liability! Hire a very good Austin Texas Realtor to help you with these potential problems and I'll help you avoid one of the biggest problems in selling Austin Real Estate listings!
It is important to note that a Seller has no liability if they did not know about a problem. But don’t try to use this as a loophole. If you ever get into a legal situation and you are caught in a lie - and it is proven you DID know about the problem and failed to disclose - you will be in a heap of trouble...and it will "cost you" a lot of cash to settle!
Legal Error #2 - Using a Vague Financing Contingency Clause
Did you know that failure of the loan financing contingency is the greatest cause for cancellation of a sales contract on residential property in Texas - and is common in Round Rock Texas Real Estate. It's also the greatest cause of disputes because most contract clauses commonly used are too vague and create uncertainty.
Usually the buyer needs a mortgage. If they can’t qualify, the financing contingency is the buyer's escape clause. So, your offer should clearly specify the ground rules about the financing contingency. If the buyer applies promptly for their mortgage, they should have an underwriting answer back within 20-30 days in Texas.
After the specified time what is required? What does the contract say? A typical loan contingency clause reads: "The Buyer may cancel the contract if he is unable to obtain an 80% mortgage for 30 years at 6.25% fixed rate within 30 days." So what happens if the Buyer's loan is rejected? The above clause is vague and doesn’t address this important issue. It does not state what notice is required.
A better clause would say the following: "If the Buyer cannot obtain a mortgage within 30 days, Buyer must notify Seller (in writing within 30 days of the date of this contract) of his election to cancel this contract. Failure to give notice of cancellation within such time period constitutes waiver of this financing contingency. When you call me to list your home, we'll go over these situations. This clause is clear; and the Buyer's obligations are clear; so there is no confusion about what is required and when...
Legal Error #3 - Making Your Next Purchase Offer Contingent upon the Buyer’s Sale of Your House
The Buyer of your home may offer that they will purchase your home - but only after they successfully sell their old home. Through no fault of the Buyer, however, their other transaction may fall apart, causing cancellation of your sale.
So, how do you deal with this? Placing a strict time limit on this type of contingency is the only defense. You need to specify, in writing, how long the Buyer has to sell their current home before your deal will automatically terminate. Contact me and I'll explain how I advise Sellers to deal with this issue.
DID YOUR REAL ESTATE AGENT MAKE YOU AWARE OF THESE IMPORTANT LEGAL ISSUES?
If you'd prefer finding and working with a more competent Realtor, who's aware of these and other important legal concerns - I'd like to apply for that job!
I'm a multi-million dollar producing agent who has 8 years of real estate experience, and I know the ins and outs of Real Estate legalities to help you AVOID disasterous situations when you sell and buy Austin real estate. LET ME GO TO WORK FOR YOU! I can be reached at at 512-289-9900.
Tell me more about your house, the unique features and approximately what your loan pay-off is - and I'll start working on a good Comparable Market Analysis for you, so we can discuss selling your home.
Thanks,
Jeff Boyce
(512) 289-9900
RE/MAX Capital City
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