Selling a home by owner can be arduous, with many documents to prepare and review. Keep these five crucial documents nearby to guarantee a smooth and successful purchase.
Insurance and property tax documentation — this helps buyers determine how much homeowners insurance will cost them. Mandatory disclosure forms — these documents vary by state and outline critical defects in the property.
Mortgage Statement
Mortgage statements are one of the most important documents to keep. These monthly financial statements show details about your loan account, including the current balance, interest rate, and when the loan will expire (known as the “maturity date”). The statement also includes a summary of payment activity for the last month or year and a breakdown of your insurance and property taxes paid through an escrow account.
These documents are required by law, so it’s best to have a copy of yours before you attempt to sell your home. It will allow you to be transparent with prospective buyers about any significant damage or repairs the property has undergone since you purchased it.
Depending on where you live, you can find your deed at your county recorder or title company office. You can also obtain a copy from your neighborhood deeds office if you still seek one. These offices typically keep documents going back decades and offer open access to the public. If you plan to buy a home for sale by owner near Woodstock, GA, you will also need a copy of your loan estimate and closing disclosure.
Home Inspection Report
A home inspection is one of the most crucial steps in buying or selling a home. A licensed inspector visually inspects the property and then writes up his findings in a report. The inspector usually points out significant repairs and maintenance issues that will require attention in the future, identifies safety hazards, and reveals information that might be hidden to a casual observer.
It is recommended that buyers and their real estate agents accompany the inspector during a home inspection. It allows the observers to learn more about the home, how its systems work, and how to maintain it. It also helps them understand the nuances of the home inspection report so they can better negotiate a sales contract.
If you are a seller, you should be aware that many buyers use statements in the home inspection report as leverage in negotiations. They often request that you make a certain number of repairs or reduce your asking price to compensate for items they find disconcerting. Having your home inspected before listing can help you avoid this situation.
Property Survey
A property survey is an essential assessment that helps determine a homeowner’s legal property line boundaries. It is a requirement in some areas for mortgage lenders, title insurance companies and is also helpful for homeowners seeking to build on their land or settle land disputes with neighbors.
There are several types of land surveys, but the most popular one is the location survey, which includes a detailed description of the property and lot, data on existing improvements, and a record of any changes to the parcel. Other land surveys include a boundary survey, which uses physical markers to determine property lines, and a construction survey, which details any structures built on the property.
A property survey can add value to a home sale, providing a clear and accurate picture of how large a plot of land is. This information can be helpful for prospective buyers who may try to bargain with sellers if they believe the property is smaller than advertised. It can also help prevent property encroachments, which is against the law.
Home Warranty
Home warranties offer a solution for breakdowns of systems and appliances in the home. The insurance can help with some of the costs when a buyer presents a list of repairs they feel are necessary after their home inspection, relieving some of the burden on the seller.
A seller’s home warranty can also be an attractive incentive to attract buyers in a competitive market. Adding a seller-paid warranty package to the listing may do the trick if a few perks, such as a well-maintained pool and landscaping, aren’t enough to draw in buyers.
However, when offering a warranty to buyers, the policy documents must spell out what is covered. Otherwise, a buyer could get a surprise after moving into their new home and discover that their washer or fridge isn’t covered by the warranty, leaving them with expensive repair bills.
An excellent way to avoid this is by ensuring that the policy can be transferred to the buyers at closing, which is an option many home warranty companies provide. It’s also essential to ensure that the policy covers the type of appliances and systems sold, such as a well pump and septic system.
Appraisal
The appraisal is essential to the process because it determines how much a mortgage lender will loan a buyer. A reputable FSBO service can provide an in-depth valuation of your home for a small fee. You can also conduct your own. Search public records for homes that recently sold in your neighborhood and have a final sale price close to your asking price. These are called comps. Also, document any upgrades you made that add value to the property.
Be prepared for your buyers to request copies of your homeowner’s insurance policy, water and electricity bills, and property tax receipts. Having handy manuals for your major systems, such as the alarm or HVAC, is also a good idea. And if you have any historical documentation, such as a framed blueprint or newspaper article about your house, include that. Sellers must disclose any health and safety hazards, such as lead-based paint or asbestos, to potential buyers.
