Atlanta Real Estate Tools
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TRADITIONAL ATLANTA REAL ESTATE PRACTICES
AGENCY DISCLOSURE AND ELECTION
When you purchase a home in the state of Georgia, the relationship
between brokers, buyers and sellers must be disclosed to all parties in
the real estate transaction. Beacham and Company offers agency
relationships to both buyers and sellers and can provide materials to
help you decide which agency relationship best meets your needs.
OFFERS TO PURCHASE
The offer to purchase is usually provided by the selling broker. This
instrument should cover all terms of the proposed transaction and must
be accompanied by an earnest money check from the purchaser. Once the
offer is fully negotiated and signed by all parties to the agreement,
it is a legally binding (enforceable) contract. Both purchasers and
sellers should make sure they understand all terms and conditions of
the offer before signing it and should seek legal counsel if they have
doubts or concerns.
EARNEST MONEY
The earnest money deposit made by the purchaser at the time the offer
to purchase is written is approximately 5% of the purchase price, but
must be an amount acceptable to seller. A personal check is acceptable.
If the offer is accepted by the seller, the earnest money is
immediately thereafter deposited in the broker's escrow account. It is
held there until closing, at which time it is applied toward the
purchaser's down payment and/or closing costs. If the offer to purchase
is not accepted by the seller, the earnest money check is never
deposited and is returned.
FINANCING
Contracts are generally contingent upon the purchaser's ability to
secure the financing described in the contract within a specified
period of time, and may be rescinded by the purchaser if, after
diligent search, the loan described is not available.
LOAN COMMITMENTS
Commitments on conventional mortgage loans are for a set period of
time, usually from 30 to 60 days. Commitments for longer periods, such
as those required for the purchase of uncompleted new construction,
require a non-refundable fee that is applied to closing costs. This fee
is usually equal to 1% of the mortgage amount and is paid at the time
the mortgage application is approved.
CLOSING DATE
Closing and transfer of title generally take place within 60 days after
acceptance of the contract to purchase. There are occasionally
unavoidable delays in securing loan approval. You should be aware that
even the most diligent agent will have no control over the situation
once your loan application has been submitted. OCCUPANCY Occupancy
generally takes place 2 to 3 days after the closing and this period is
usually rent free to the seller. A specific date of occupancy is
negotiable and is a term of the contract.
CLOSING PRACTICE
Closings generally take place at an attorney's office, with all parties
to the transaction being present. The listing and selling agents and/or
brokers are also present.
LEGAL COUNSEL
Most closings in this area are handled by the attorney representing the
mortgage company, whose fee is paid by the mortgage company and is part
of the closing costs. The closing attorney is responsible for the title
examination, recording of the documents, etc. Buyers and sellers are
encouraged to seek private counsel to resolve any legal questions
regarding the transaction or to accompany them to closing. In those
instances where no mortgage company is involved, the purchaser may
engage, at his expense, any attorney he chooses to handle the
transaction.
FUNDS REQUIRED FOR CLOSING
Down payments and closing costs are to be provided in the form of a
cashier's/certified check, payable to the purchaser, who will endorse
it at closing. An estimate of closing costs may be obtained at the time
loan application is made.
TITLE INSURANCE
Mortgagee's title insurance, which protects the lender only, is
required by all lending institutions in an amount equal to the amount
of the loan. Purchasers are encouraged and advised to obtain owners'
title insurance for the full value of the residence, or to discuss this
matter with legal counsel.
HAZARD INSURANCE
Purchasers are required to bring a policy for fire and hazard insurance
to the closing and, if applicable, a flood insurance policy. The
minimum value of this policy should be equivalent to the loan amount.
One year's premium must be paid prior to, or at, closing and the policy
must contain a loss-payable clause in favor of the lender. Should you
pay for the policy before closing, you must furnish the paid receipt at
the closing.
HOME INSPECTIONS
Most real estate contracts require the seller to warrant that at time
of closing, the property will be in the same condition as it was on the
date this agreement was signed by seller, normal wear and tear
excepted. It is the purchaser's responsibility to check that all
appliances remaining with the premises, and the heating, air
conditioning, plumbing (including without limitation, septic tank
system or systems, pool and spa) and electrical systems will be in
normal operating condition prior to closing, as the seller's
responsibility ceases at closing. It is common practice for the
Purchase and Sale Agreement to contain a contingency upon the purchaser
obtaining a complete inspection of the structural aspects of the
premises, as well as the mechanical items. Such inspections can be
obtained by employing an inspector of your choice. Costs range from a
flat fee of $150.00 to $1.50 per thousand of the sales price. This cost
is paid by the purchaser. The correction of any defects determined by
the inspection is usually negotiated between purchaser and seller.
WOOD INFESTATION REPORT
It is common practice for the Seller to provide to Purchaser at
closing, and at Seller's expense, a report from a licensed pest control
operator on a standard form in accordance with the regulations of the
Georgia Structural Pest Control Commission, stating that the main
dwelling has been inspected and found to be free from visible evidence
of active infestation caused by termite or other wood destroying
organisms. If visible evidence of active or previous infestation is
indicated, Seller agrees to (a) correct said infestation and structural
damages resulting from said infestation and provide documentation
evidencing correction of same and/or (b) provide documentation,
satisfactory to lender (if applicable), indicating that there is no
structural damage resulting from any previous infestation. If any
additional inspections and/or reports are requested by Purchaser or
Purchaser's Lender, costs, if any, for such inspection(s) and/or
report(s) shall be paid by Purchaser.
RADON
Radon tests are available for those purchasers who may be concerned.