Thursday, February 10, 2011

Listing and Seller Contract Checklist

So, you're taking a listing or preparing your sellers for signing a contract. Although you could be months away from settlement, here are some items you can address right away to help ensure a smooth transaction.

o Pull and examine the seller's deed. Make sure the name matches what you're putting on your listing agreement. Has there been death or divorce since the sellers took title?

o Is the property leasehold or fee simple?

o If leasehold, ground rent amount, ground rent owner and contact information, when was ground rent last paid?

o Does the owner have an Owner’s Title Insurance Policy? Ask this question and get a copy of the policy, or at least a copy of their settlement statement from when they bought the property. This can help later with any title issues or to give the buyers a break on title insurance costs.

o How many loans is the seller paying, and what type of loans are they (FHA, VA, conventional, HELOC, etc.)?

o Obtain at least the last 4 digits of the seller(s) social security numbers. This is often required to order a payoff.

o If the sellers have an FHA loan, try to avoid closing the last two days of the month. If the loan isn't paid off by the last day of the month, the seller will owe an additional month's interest.

o Will all parties attend settlement? If not, will a power of attorney be used? Will we be sending docs to the seller? Note that we always prefer the sellers to be in attendance at settlement.

o Is the seller a resident in the state where the property sits? In Maryland, there is a nonresident witholding tax.

o Instruct seller not to pack documentation. There may be some important documents in their possession which help us clear some issues.

Being proactive and obtaining as much information in advance can help avoid some of these common closing delays. As always, feel free to reach out to one of our professional settlement officers, or email us at info[at]MASettlement[dot]com!