PURCHASE CONTRACT :DO IT RIGHT THE FIRST TIME
Do it right the first time. So you are writing a purchase contract for your buyers, with a conventional mortgage.
Here are the ten things you want to make sure you do right for the least possible underwriting headaches.
- Make sure you ask your buyers who is going to be on the loan. Only people who are on the loan need to be on the purchase contract. For example, husband and wife are buying the home together, and only husband is on the mortgage, but both are on the title. Only husband’s name is going to be on the purchase contract.
- Names of the sellers: Owner of record is not good anymore, you need to spell it out, as to who the sellers are. Sellers need to be the same people who are on the title currently.
- If the property is a bank owned property, make sure you get the correct bank’s name on that line.
- If you are asking for any personal property, like kitchen table, big screen television, pool table. Make sure that you have an addendum that states that any of these items have $0.00 value.
- If there are any sellers disclosures that are part of the purchase contract, make sure you have those and are filled out correctly and singed by both parties .
- If during inspection, your buyer has a brilliant idea about asking for money for repairing any items, make sure the credits show up as closing costs credits, underwriters don’t like to know that something is broken and instead of getting it fixed, buyers are getting money.
- If any repairs are needed per the appraisal report, get them done, you will not get any waivers on those repairs. It does not matter who gets them done, the underwriter wants to see a final inspection showing the repair was done with receipts or certifications etc.
- If it is a relocation company, make sure you have copies of correct Power of Attorney for the person who is signing on the sellers behalf.
- Please put reasonable dates for closing and mortgage contingency, that can be delivered. If dates for closing are changed and they happen to fall after the date on the contract, the underwriter can ask for a new contract or an addendum to reflect the later date of closing.
- These are just the guidelines for Conventional loans, if your buyers are doing a FHA, VA loan etc, look for blog on doing it right for FHA loans.
SO IF YOU ARE WRITING A PURCHASE CONTRCT, DO IT RIGHT THE FIRST TIME . Please read our blog at www.ridhiraheja.com for more help with doing more business.