REAL ESTATE CORNER

Lynn and John Drewry

BUYING A HOME: CONDITIONS AND CLAUSES

Last week in our article ALMOST READY TO MAKE AN OFFER (see Web site www.lynnandjohn.ca and select “Published Articles”),  you could have read about the following things:

A financing condition is a must for those of us who borrow money to buy a home. Even if you have pre-approval from a mortgage supplier it is not guaranteed until the mortgage supplier has reviewed your accepted offer and, in many cases, obtained an appraisal of the property. Remember always to see your bank or broker before you start looking at homes.

Home inspection is usually a must, even with newer homes. Not only does it protect you against major unforeseen problems, but the inspector also provides a great deal of information about the home you are buying.  The expenditure is usually about $400 and is money well spent. Should there be major problems with the home, such as structural or water damage and if either you are not willing to proceed or the seller is not willing to fix the problem, you can cancel the deal.

A survey is a useful legal document and usually the lender requires this document to approve the financing. It should show the property size, the home as situated on the lot, as well as any other structures such as deck, pool and fence. Older surveys might only show the property and home.  It might also disclose restrictions such as easements and rights of way. If the survey is incomplete or not available, you might be advised to ask for a new survey. A less costly solution would be title insurance.  Title insurance is new to the real estate market and should be explained by your lawyer.

A condition known as sale of buyer’s property is used when you are purchasing a home, but need to sell your current home first.  If you choose this condition, the seller will limit the time you have to sell your home and may also continue to show the property to other interested buyers.  Should the seller want to accept another offer, you, the first buyer, are given 24 or 48 hours to decide whether to buy the home without selling your current home.

Insurance companies have become extremely particular in the last few years to the extent that getting insurance is no longer automatic. Some of the problems are aluminum wiring, 60 amp hydro service, non-grounded receptacles, oil tanks, water leakage, moulds, old furnaces and plumbing.  If the house is older than ten years and even less, it is prudent to insert a condition on getting insurance.

A Seller Property Information Statement is a detailed statement made by the seller of the condition of the property and home and its immediate environment.  It not only provides useful information but also helps your case if you encounter problems after the closing. It can be requested in a clause attached to the offer.

Your sales representative will advise you of the conditions and clauses you need.

Your questions, opinions and ideas for article topics are welcome.  Phone us at: 905 873-0440.