Before You Go to Contract, Last Minute Legal Matters to Seek Advice
For many of us retiring, we may not have bought or sold a house in years, perhaps even decades. Before you put your signature on the dotted line and savings at risk, we created a short list for you to refresh your memory of the possible ‘unknowns’ which could complicate things for you. This by no means represents all the possibilities out there. The more questions you can get answered ahead of time, the less likely you will find yourself chasing your earnest money hoping to get your deposit back if you discover something unsettling to you. Many times, the answers are simple to find and many times they are not. We strongly encourage you to seek legal advice from a professional attorney you trust before you write a real estate offer in a master planned community in the Southeast. Clauses can be added to the Contract for Sale and Purchase Agreements by your Attorney to protect you while questionable issues are being researched further to your satisfaction.
- Community Development District (CDD) Tax – A bond created by the real estate developer in defined communities to pay for roads and utilities. This special assessment tax is added to your annual property taxes until paid in full.
- Earnest Money Escrow Account – Where money is deposited until closing. Be aware some real estate developers ‘use’ this money prior to closing if it is not placed in an escrow or trust account.
- Fixtures & Personal Property to be removed by Seller – Examples: light fixtures, appliances, window treatments
- Homeowners Association Disclosure - Discloses the right to file a lien for unpaid special assessments and monthly maintenance dues.
- Liens - Liens are financial claims against the property which must be settled to receive clear title to the property. You can find liens recorded in public records yourself or better yet, ask for a title search by a title company or your attorney.
- Federal Estate Tax Lien – Unpaid federal taxes
- Real Estate Tax Lien – Unpaid taxes
- Special Assessment Lien – Unpaid improvements to the property
- Federal Income Tax Lien – Unpaid federal taxes
- Judgment Lien - Damages awarded by the court Lis Pendens – a notice of a pending lawsuit against the property owner. If the lawsuit is successful against the property owner, the Lis Pendens becomes a lien on the property.
- Mechanics Lien – Unpaid services provided by Contractors, Subcontractors, Builders or Suppliers.
- Mortgage Lien – A loan secured by the property
- State Corporate Income Tax Lien – State unpaid taxes for corporations.
- State Intangible Tax Lien – Unpaid state intangible taxes
- Vendor’s Lien – Owners lien for unpaid monies due.
- Membership Clubs – Look for shortfalls in the annual budgets and at special assessments over the past three years to see how well the club is financially managed.
- Property Report – Required by US Department of Housing and Urban Development, a disclosure report prepared by land developments of over 100 lots. Discloses promises made by the land developer of amenities, completion dates and other financial information.
- Unpaid utility bills – Water, power and cable may be liens on the property from the prior owner
- Verify Future Property Tax Amount – Do not assume the annual amount the Seller is paying is what you will be paying.
- Asbestos – Fire Retardant material used in homes built before 1979. Get an inspection to confirm presence. If so, consider removal Contaminated Property although many times it is not recommended.
- Environmental Issues – Be aware of nearby landfills, high tension power lines, sewer and water treatment facilities, nuclear power plants, fossil fuel power plants and paper mills.
- Lead Based Paint – Used in homes before 1978. Get an inspection to confirm presence and consider removal.
- Mold – Get an inspection to confirm presence and consider removal.
- Radon Gas – Colorless odorless gas hazardous to your health. Get an inspection to confirm presence and consider removal.
- Deed Restrictions – Examples: include 55+ communities, density, boat storage
- Restrictive Covenants – Examples: fence limitations, home styles, landscaping, house color, boat storage, motorcycles
- Air Rights – Air traffic patterns, high rise view obstruction
- Littoral Rights – Boarding non-flowing water man-made lake rights or natural lake rights
- Mineral Rights – Subsurface rights to gas, oil, minerals
- Riperarian Rights – Rights in and to flowing water
- Utility Easements – By utility companies
Zoning and Code Violations:
- Army Corp of Engineers Boundary Line – Reservoir building restriction line. Confirm permits for dockage exist and be sure to keep current to avoid losing the permit.
- Coastal Construction Control Line – Limits building to protect dunes and coastal beaches Energy Efficiency of Existing Appliances and Mechanical Systems.
- Flood Zones – Obtain FEMA maps and ask about floods in the past Insurance Zones - get a quote ahead of time from a local agent, insurance zones will effect what you pay.
- Inspections – Electrical, Roof, Structural and Termite inspections are advised and can be conditional terms added to the contract.
- Open permits or lack of to bring property up to code – improvements made without a permit may financially impact you when they are discovered. Confirm all open permits closed and improvements on file with the county or city match improvements to the home.
- Survey - Confirm property boundaries, easements and encroachments, rights of access.
- Water Wells and Septic Systems – confirm water availability and septic system capacity to match proposed home size when building new construction. Consider a second opinion from a Dowser.
If you have come across issues not mentioned above, we would appreciate your comments for the benefit of all. Write [email protected]
Good luck with your search. We're here to help!
Warmly, Margie Casey Founder