Overview of the Real Estate Contract Process in the New Haven, Connecticut Area
If you are thinking of buying or selling a home in NEw Haven County, Connecticut, it is important to understand the contract process.
The process starts with the potential buyer of the real estate making a written offer. This offer will contain the relevant terms, such as property address, purchase price, closing date, mortgage amount, date by which to obtain mortgage, inspection terms, the date by which to accept and any other relevant terms or conditions.
In the New Haven County area, including Hamden, North Haven, Cheshire, Wallingford, Woodbridge, Orange, West Haven, Branford and other area towns, the buyer's offer is typically made using a contract form, often supplied by the real estate agent. Acceptance of the offer results in a fully binding contract. Many real estate agents use a form of contract provided by the New Haven Board of Realtors and the local Bar Association. This contract form contains all the ‘boilerplate' provisions, and the terms specific to the transaction must be added to the form. The property condition disclosure report is also included. Although the contract form does not usually contain an automatic attorney review contingency, it is a good idea to have an attorney review the contract before you sign it. Since the contract forms used in different areas and even by different brokers have different provisions, you should always have an attorney review the terms and provisions before you sign it. Remember, when you are making an offer on a contract form, and that offer is accepted, it is a binding contract and the rights and obligations of the parties will be determined by the terms contained in that contract. More information is available on my website, Connecticut real estate attorney information.
There are certain important provisions that must be included in the contract. These include the address of the property, the names and signatures of the buyer and seller, the purchase price, deposit and closing date. These are the basic terms needed to make a binding agreement. In addition, for the protection of the buyer there must be a mortgage contingency provision which would include the amount and terms of the mortgage and the date by which the mortgage must be obtained. The buyer should also have an inspection contingency provision, which allows the buyer to have a building inspection on the premises by a certain date. There should also be a listing of any personal property included with the sale, such as appliances, draperies, etc. In addition, any special provision, such as an agreement that the seller pay part of the buyer's closing costs, would need to be included. Anything not included will not be a part of the binding contract. You should work with your real estate agent in putting the contract together, in consultation with your attorney. I have written more information about real estate contract contingency provisions.
After the contract is signed, the buyer will perform inspections on the property. If the inspections are acceptable, the buyer will then work with the mortgage lender to get the mortgage loan approved. At this time, your attorney will obtain a title search of the property and prepare for the closing. The buyer will also need to purchase homeowner's insurance for the new home. During the entire process a buyer should keep in close contact with their real estate agent.
If you are selling or buying a property through a ‘short sale,' which is when the seller owes more on the house then they will be selling it for, it is especially important to consult an attorney before a binding purchase and sale agreement is executed. You should work with your attorney and real estate agent to address any problems that come up during the home purchasing process.
Please note that this is not legal advice. Please contact your attorney for legal advice.
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