Process of buying a house directly from seller

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Guidance needed. What is the process of buying a house directly from a seller. Does the bank appoint an attorney for me or do I hire my own attorney? The seller is a real estate agent and had already sent me an offer to sell with 1000 deposit. Thank you.

You dont necessarily need an attorney, but it would be wise to have one review the documents if you are new to the process. If the seller is an agent, then they should know everything needed for the sale.  The only really essential people to have involved is a title/escrow company. Below are some excerpts from a letter that I used to send to sellers who were trying to sell without an agent with details on what to look for. It contains some info on documents needed, details in an offer, etc. 

Forms that may be required by the State: (may need to be given to the buyer)

  • -Residential property disclosure form (must include all known defects, can have ramifications if all issues are not listed.) 
  • -Lead Based Paint Disclosure form (required for properties build prior to 1978). The EPA pamphlet can be found easily by searching google. Here is the link: https://www.epa.gov/lead/protect-your-family-lead-your-home

Some documents you should look for if an offer is submitted to you via a licensed agent:

  • -Consumer guide to agency relationship. This is needed if a licensed agent is representing the buyer. If an offer is coming direct from a non-licensed person then this would not be required.
  • -Agency disclosure form (stating who is representing you (yourself), and who is representing the buyer). This is needed if a licensed agent is representing the buyer. If an offer is coming direct from a non-licensed person then this would not be required.
  • -Affiliated Business Arrangement form (used if a Title Agency has a relationship with a real estate broker). This is needed if a licensed agent is representing the buyer. If an offer is coming direct from a non-licensed person then this would not be required.

Common items contained within an offer document:

  • -Price including any seller paid closing costs if applicable
  • -Sale/ possession Timeline
  • -Items included and/or excluded in the sale (example: lawn mower, chandelier, etc)
  • -Financing contingency
  • -Title Agency information
  • -Escrow instructions (who will pay for escrow, owners policy of title insurance, commissions, recording fees for the deed and any mortgage, etc)
  • -Inspection contingency info, responsibility, and timelines (general home, septic, radon, pest, well flow rate, etc)
  • Locality Point of Sale instructions (if required in your city, I can send you info if needed) and responsibility.
  • Addenda (final walk through, included property disclosure and lead based paint disclosure, agency disclosure form, FHA/VA home inspection notice, etc)
  • Earnest money information (who is holding earnest money, which is normally a broker or title agency, and what will happen to this money if the sale falls through)

The above items are the basics of a sale, but this is not a complete and comprehensive list. Even if you are working directly with the seller, then you will need to get in touch with a title agency that will assist in handling/allocating funds, and perform the deed recording at the courthouse.

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