The law requires transparency in all aspects of a property from the home owner and real estate agent to a potential buyer. In other words, they need to let you know if there is any factor that could lead to you not purchasing the home.
Even though it is a legal requirement, you can’t rely on transparency. It is up to you to ensure that the property is in good order before entering into a legally binding contract or sales agreement.
1. Inspect
The property owner should provide you with inspection certificates for the electrics and plumbing in the home. You may also request a building inspection and termite inspection, especially in the case where you are thinking of buying an older home or property. These certificates should be no older than 6 months.
If they cannot provide the necessary inspection certificates, you may request that inspection be carried out at your own cost. Should the home owner still refuse, it is probably best not to purchase the property as it is more than likely that there are issues that owner is trying to hide.
You may also want to inspect the property to ensure that there are no necessary repairs or renovations that need to be made. These details can be added to the contract to be completed by the owner before the transfer of funds for the property purchase.
2. Investigate
You need to investigate the property title to ensure that there are no reasons or encumbrances that could prevent the transfer of ownership. Obstacles could include a lien on the property, where the property has been used as collateral or if the purchase price will not cover an outstanding mortgage.
The Legal Elements solicitors advise you to ensure that all rates and taxes are up to date and that the relevant Homeowner’s Association fees are paid in full. In the event that you are purchasing within a building or complex, check if the levies are also paid up to date. If you find that there are any outstanding amounts, you can offer to pay these and deduct the costs from the purchase price.
You may also want to investigate any rights that are associated with the property and whether these rights can legally be passed to you along with the title.
3. Due Diligence
The registration of the property and title deed are a matter of public record. You can access these through your local public records provider or your county courthouse. Some records are available online while you may need to approach the holder of public records in person in some cases.
You may also want to do an online search or visit your local library to source any additional information such as news stories related to the property in question.
If you do not have the time to do your due diligence, you can hire a conveyancing attorney or private investigator to make inquiries on your behalf. If you find any issues that were not made transparent, this can be grounds to nullify any contract that you may have entered into.
