On homes and real estate: Buyer and seller should hire a lawyer
Q. My tenant has been renting from me for 18 years. He has received some money and wants to buy the house. It will be a cash deal. What have we got to do now to formalize this sale? I know probably a lawyer will be needed. There will be no inspection because he knows the house. Where do we start?
A. Sounds like a win-win situation, which is always pleasant.
Your first job is agreeing on the sale price, if you haven’t done so already. It’s not always accurate to use the tax assessment figure, and I wouldn’t rely on Internet sites for this important matter either. Sometimes each party hires an appraiser, with an agreement to average the two estimates and use that figure. You wouldn’t need elaborate expensive appraisals. Brokers with experience in your neighborhood can provide simple one-page estimates of market value.
Next, you’ll need a binding contract, property executed. When it comes to the sale of real estate, nothing you may have said to each other is binding until it’s contained in a written contract signed by both parties. Each of you should retain a lawyer (yes, even in a friendly transaction.) Your attorney will help you with the seller’s disclosures required by law. The buyer needs assurance that he’ll be receiving clear title, free of undisclosed liens or easements. And in this state, lawyers traditionally conduct the final closing session that adjusts financial items like property taxes, and finally transfers title.
Then when it’s over, you can all go out to lunch and celebrate.
Q. If a therapist sees clients in a home office next door, is the seller legally or ethically obligated to disclose this to potential buyers? Is there any way to estimate what impact, if any, this would have on the sale of the home in question (next door to the therapist)? The issue is not appearance, just the potential that some buyers might feel uncomfortable about the idea of clients with mental health issues. This therapist does not treat clients with difficulties related to violence or addiction.
A. You’d be amazed at how much the answer could vary depending on what state you’re located in. In California, for example, a home seller must disclose any death or criminal act that occurred on the property within the preceding three years. In New York, you need not disclose that at all. And when it comes to off-site conditions, in New Jersey problems within a half-mile must be disclosed.
The bigger question is whether your neighbor’s practice does constitute a problem. Evidently he or she doesn’t worry about seeing clients at home, and some potential buyers might not either. It sounds as if it does make you uncomfortable, though.
Sometimes I’m asked, “How do you know all the answers?” Simple. I get to pick what goes in the paper, and if I don’t know, I don’t print it. In this instance I’m including it anyway, because it’s an interesting question. Perhaps we’ll hear what others think about it.
Q. Can you give me some guidance in how much to charge for renting a house? It’s in very good condition, and we’ll be leaving the appliances including the washer and dryer. I have some good people who will rent it so I just need help about the price. How do I know what is fair? I don’t know how much other places are rented for, but I’m sure that would have a lot to do with what to ask.
A. You’re on the right track. Pretend you’re looking for a house to rent in that area, and search the newspaper’s classified ads, the Internet and Craigslist. You can’t set your figure by what you’d like to receive or how much you need in order to make a profit. Every neighborhood has its own going rate, and you don’t want to ask much above or below that.
No matter how good your prospective tenants are, ask for permission to run a credit check. “Our lawyer insists” is always a useful excuse.
Q. If I buy a house with a VA mortgage, nothing down, and years later I sell it; can I do it all over again?
A. Yes. You can regain eligibility for another VA-guaranteed mortgage loan if the first one has been paid off. Or you could buy another house with a VA mortgage if your first loan was assumed by another veteran who substituted his or her certificate of eligibility for yours.
Ÿ Edith Lank will respond to questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (include a stamped return envelope), or readers may email her through askedith.com.
© 2013, Creators Syndicate Inc.