When Buying a Home, Understand What You’re on the Hook For

What to consider when moving

Moving into a new home is a lot of work. Developing a checklist and getting enough boxes and bubble wrap alone can be stressful, to say the least. However, the actual moving part is fun when you compare it to the legal and financial undertaking necessary to buy a new house.

So, you saved for a down payment and secured a preapproval through your bank, but there are all sorts of fees that come along with the purchase of a new home. To get a better grasp of what’s expected of you — the buyer — and the seller before and at closing, read on.

Keep Your Wallet Close & Your Pen Closer

While some costs — like property taxes — are unavoidable for both buyers and sellers, there are other responsibilities that fall to one party or the other. However, many of these additional fees are outlined in the paperwork itself.

For example, in most cases, the seller will more than likely pay for any real estate agent commissions. According to the Lenders Network, “typically commission is 6 percent of the final sales price. The seller’s agent will split this commission with the buyer’s agent.”

Sellers then pay any transfer tax, applicable capital gains tax, and a small percentage of the closing costs. Depending on what your local market is like, sellers might take on more financial responsibility to make the sale more appealing to buyers. In these cases, a seller could pay for a buyer’s home warranty, which acts as a service contract for the first year after purchase.

Whatever you agree to, your agent should have it worked into the paperwork. Your purchase agreement and any addenda will be your “leg to stand on” in the event that a seller does not deliver on things, like repairs or credits they promised to make.

Request Repairs, Not a Complete Restoration

When it comes to requesting repairs from a seller, the sky’s the limit. You can ask for cosmetic fixes along with the important stuff, like plumbing and structural repairs, but don’t go overboard. Be reasonable with your requests, whether it’s for a repair or credit on the sales price.

Approach each request from the seller’s point of view. Would you want to sell a home to someone asking you to fix every little thing in the home? Sellers usually put in a lot of money beforehand to get the home in tip-top shape, but they’re selling a used home. Unless the home is being sold “as-is,” sellers expect to receive requests.

Buying a home for sale as-is means you agree to the terms that sellers will not repair things like structural issues, roof leaks, or the like. Most of the time, the sales price for an as-is home is discounted, taking the cost of repairs into account. If you buy an as-is home, expect to pay for every problem you encounter, regardless of the severity.

If the home is not being sold as-is, you should make requests. To do this fairly, rely on a home inspection, which should bring any severe structural or system defects to light. According to Maximum Exposure Real Estate, an inspection “should not be [done] to create a punch list that itemizes every minor defect … you expect the seller to fix.” If you want everything to be perfect before you buy, then consider buying new.

Once inspections are completed, make your requests verbally and in writing. You should request that all repairs be completed before moving in, or that you are credited for the repairs that you’ll take care of when you see fit. Remember, everything should be documented in the paperwork, too. Be sure to show up for the final walkthrough of the home as well.

Closing The Door on a Final Walkthrough

Before everything is transferred over and closing is complete, take one last walk through the home. This is your last opportunity to check out the home yourself.

That doesn’t mean now is the time to start picking out other requests for repairs — all you need to do is check that any agreed-upon requests were completed and that nothing else that’s significant has changed. You should make sure the heating and air are working, as well as the toilets, light fixtures, disposal, appliances, and water.

The final walkthrough is your last time to be in the property before it becomes yours. This property will soon be your home, so verify that everything is as you agreed. The next time you walk through the door, it’s all yours.

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