I just had these three questions posed to me today:
Q: Can a house be sold without an appraisal?
A: A buyer cannot secure a loan without an appraisal. The appraisal assigns a value to the home. This value is what the lender will use to determine how much and if to loan the purchase money to the buyer. The appraisal is ordered by the lender and paid for by the buyer during the loan application process. In the case of a cash buyer, they can still order their own independent appraisal if they wish. After all, an investor or purchaser would not want to pay more for a property than what it is worth right?
Q: Can a house be sold without a surveyor coming by to make sure the lines are correct?
A: Yes a house can be sold without a survey. However, it is the buyer's choice whether or not they want to order a survey. The survey is ordered by the title company (settlement company) and paid for by the buyer. If there are boundary issues, the buyer may ask for the Seller to rectify the problems. If they are not rectified, then the buyer, if he chooses to go forward with the sale, would inherit the boundary issues. A survey will also tell you where any easements are on the property. This includes public easements and utility easements. Easements are portions of the property that are being used by these parties for access to something on or beyond the property or for wires, sewer lines, etc.
Q: Is a title search also required before selling a house?
A: Yes. A title search is required to determine whether there are any "clouds" on the title.
1- is the person selling the property actually the person on the title and the one allowed to sell the property? Are there any other owners on the title? If so, you will need all parties' consent and signatures or properly executed powers of attorney to go to sell the property.
2 - Are there any liens or is there legal action against the property, or has the owner declared bankruptcy? It is part of the due diligence on the part of the buyer. The seller must present "clear and marketable" title in order to sell. If there are too many clouds on the title, the title may not be insurable (the buyer can't get title insurance) and the buyer may not want to buy the property. After all, who do you know that would willingly inherit problems?