Avoid common problems when purchasing a home

All Things Legal

By Jane M. Winand, Legal Assistance Attorney

Whether you are getting ready for a new assignment or are just tired of renting, there are some important things to consider before purchasing a new or used home.

Doing your homework before purchasing will make the process much easier and allow you to avoid common problems.

Most importantly, if and when you find the house you want to buy or the plans for the dream home that you want to build, make sure that you enter into a written contract with the seller or builder that contains all of the promises of the parties.

In Maryland, as in most states, a contract dealing with real estate must be in writing to be enforceable. You may have a clear, concise and very favorable conversation with the seller or builder, and leave with a warm and fuzzy feeling that the home will be your dream come true. However, if those oral promises are not included clearly in the written contract, they will not be enforceable.

Although the builder or seller is promising the moon, don’t just go with it. Imagine that the builder or seller is speaking in a foreign language that you do not understand and ask that all oral promises be reduced to writing that is clear and understandable in the contract.

The contract should contain all of the information upon which you and the seller have agreed. If you are purchasing a previously owned home and the seller agrees that you can keep appliances such as the refrigerator, fixtures like the dining room chandelier, or window treatments such as the kitchen curtains, these specific arrangements should be part of the written contract.

It you are having a home built, the contract should contain all of the specifications of the new construction. For example, the contract should detail the type and amount of insulation to be installed, the number of light fixtures and electrical outlets, and the grade of appliances and carpeting to be used.

Many times in new construction, the builder will give you an allowance or an amount of money allowed out of the purchase price which will be used to buy appliances, light fixtures, carpet and the like. The amount of the allowance should be spelled out and you must have an idea of the overall cost of specific appliances, fixtures and other features before agreeing to the allowance. Otherwise, there may not be enough money to cover the items that you want and you may have to settle for a cheaper item or make up the cost difference out of your own pocket.

Make sure that the contract has an escape clause if certain events do not occur. For example, most real estate contracts are contingent on the buyer being able to get a mortgage to buy the house. These provisions usually state that the buyer will not be required to go through with the sale unless he or she can get a mortgage of a specified amount, at a specified minimum rate of interest, with a minimum amount of discount points.

As a result, if after giving it your best shot you don’t succeed in getting a mortgage, you get to walk away from the contract with your earnest money.

Sometimes the contract will contain a provision requiring the home to be thoroughly inspected (very important with previously owned homes) and allow the buyer to have the option of insisting that the seller repair the defects or that the buyer be allowed to walk away from the deal.

If this is your first time buying a home, you should consider letting an attorney look at the contract before you sign it. Even if it is not your first time, an attorney review is a good idea.

Remember, a home is a substantial investment of money, energy and emotion. With so much at stake, you should be cautious.

If you have questions about a home purchase, contact the Fort Meade Legal Assistance Division. To schedule an appointment, call the Legal Assistance Division at 301-677-9504 or 301-677-9536.

The office is located at 4217 Morrison St., first floor, Office of the Staff Judge Advocate.

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