Home Selling 101, Part 3 – Dealing with the contract. When you get an offer from a buyer, it will normally come in the form of a written contract. The new contracts are a dozen and more pages long, with dozens of separate paragraph governing every detail of the transaction. If you have not already retained an attorney, this is a good time to do that.
Some people simply go ahead and sign the offer they receive, and then get an attorney involved. (If you have already signed a contract without consulting an attorney, it’s okay. This is not the end of the world, but sometimes it causes headaches.) Some of the things your attorney will check before you sign are the amount of the tax credit prorations, closing costs credits, warranty provisions and other things that you may want to be aware of before you sign so you know exactly what you’re getting into.
For instance, tax credit prorations for property taxes in the south suburbs are usually at 105% of the last tax bill. That means that if you paid $5,000 in property taxes last year, the prorated tax credit to the buyer will be based on assuming that taxes will be $5,250 for the next year. However, some attorneys from Chicago and northern suburbs are used to dealing with prorations at 110%. That means that the tax credit you would give your buyer would be based on an estimated tax bill of $5,500. If you engage an attorney before signing the contract, he can spot things like this before you sign. That can mean one less issue to negotiate later, and therefore one less possible wrench in the gears of a smooth running transaction. There are several terms even in the form contracts that your attorney can spot and help with upfront if you engage him or her prior to signing the contract.
Again, if you have already signed and accepted an offer, it’s okay. But get an attorney involved as soon as possible.