Legal Requirements For Real Estate Sales

Legal Requirements

To save costs, lots of homeowners try to sell their house by themselves. This For-Sale-By-Owner sale can save you thousands in commissions by finding a buyer on your own. However, important legal issues arise when you sell your home. 

In order for the sale of Real Estate to be binding, it must be in writing. The Purchase Agreement should contain the specifics of the transaction, such as the sales price, the closing date, the financing terms for the buyer, and any special contingencies, such as seller-paid closing costs or the sale of the buyer's home. The purchase agreement should also spell out the rights and remedies of the parties and how the transaction can be canceled. 

The Iowa Law requires that the seller provide a written disclosure also known as the “Seller’s Disclosure” statement to a purchaser. The disclosure statement is required even if a property is being sold “as is” condition. For homes built prior to 1978, a lead-based paint disclosures statement is required by Federal law. New legislation requires that a seller inform a buyer about the radon testing. 

Once you have a buyer, you should locate your original abstract to your property. This must be done quickly to avoid delays. The abstract of title must be brought up to date and the buyers and sellers searched to identify any adverse liens and judgements. The abstract will then be examined by an attorney on behalf of the buyer. There may be title issues to address, such as the death of a titleholder or judgements against a person of a similar name. 

Once the title opinion is complete, you will need to execute a deed and other supporting documents to transfer title to the new buyer. The recording statues have very specific requirements for the format of the deed, and it is vital to correctly vest titles. The deed must be accompanied by a declaration of value, which is delivered to the local Assessor’s Office. A groundwater hazard statement is required on all properties to disclose potential groundwater contamination. If the home has a septic system, a new law requires that the system be inspected prior to sale. 

Selling a home involves more than shaking hands on a price. Finding a buyer is only the first step through the legal process.

 

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