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March 18, 2013

Buying or Selling a Home

The Purchase Contract

Are there any special considerations when you are buying a home from a builder?

A buyer purchasing a new home from a builder may or may not work through an agent. If you are not working with an agent, you may want to consult your lawyer to ensure that the purchase contract with the builder contains no surprises. In addition, you may want to consider having the finished structure inspected notwithstanding its newness. Remember, it's the quality of the construction, not its newness, that is important. An independent inspection can give you this assurance.

If you are contracting with a builder on a home that is not built or finished, you will want to make sure you will get what you think you are buying. For example, model homes typically include options, rather than standard features. Along with superior windows and siding, these could include better-quality kitchen cabinets, higher-grade carpeting, and more expensive lighting fixtures. Make sure that the builder provides you with a complete list of standard and optional features. If you are choosing options, make sure the purchase contract includes the specific cost of all options.

You will want to know other facts as well, such as the type and extent of any landscaping to be provided by the builder, known plans for the development of surrounding property, and the exact provisions of any warranty from the builder. If possible, you will want a warranty that is insured by an insurance company, rather than a warranty guaranteed only by the builder. Finally, the builder should provide you with evidence that his or her subcontractor's and material suppliers have waived any liens they might have against the property in the event the builder does not pay them for their work.

Specified dates for completion and occupancy should be included if the home is not yet built. You can provide for a penalty or for the right to cancel the contract if the builder exceeds these dates.

>>What is an offer to purchase?
>>What might I include in my offer to purchase a home?
>>What is earnest money?
>>How is the offer negotiated?
>>How does an offer relate to the purchase contract?
>>Can oral promises constitute a contract?
>>When should we involve a lawyer?
>>What are the key provisions of the purchase contract?
>>What is an inspection rider?
>>What is an attorney-approval rider?
>>What is a mortgage-contingency rider?
>>May the seller refuse a mortgage-contingency rider or an inspection-contingency rider?
>>What happens to my earnest money deposit if we do not complete the sale?
>>Can a buyer sue a seller for backing out of the contract?
>>Are there any special considerations when you are buying a home from a builder?

Practical Law Home | Buying or Selling a Home | Basics of Buying a Home
Basics of Selling a Home | Why Real Estate Is Covered By Special Laws | Real Estate Brokers
*The Purchase Contract* | Financing a Home Purchase | The Closing | The Fair Housing Act
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