Buyer’s Guide

YOUR PERSONAL GUIDE TO PURCHASING A HOME

SEARCHING FOR A HOME

Your professional and knowledgeable Silversons Realty sales associate will help you find the home you have always wanted. To find a home that meets your needs and budget, a Silversons Realty sales associate will provide the personal attention and advice that will make your search easier. Our thorough knowledge of the marketplace assures that together we will find the right home for you.

New York State Disclosure Law

When you are buying or leasing real estate, you need to sign the “New York State Disclosure Law—Disclosure Regarding Real Estate Agency Relationships.” This will allow you to choose, if you want, your broker to represent you through the buying process.

Your Realtor can show you:

  • Any and all listings on the Multiple Listing Service (MLS)
  • Any listings which you see advertised in newspapers by any broker
  • Any house you see with a “For Sale” sign on it, even if it is listed by a different broker
  • Any home for sale by an owner (FSBO)

All Realtors cooperate through the MLS system to make all homes listed on the system available to everyone. Through Internet Data Exchange (IDX) individuals can have access to all listings on the internet.

NEW YORK STATE FAIR HOUSING LAW

 

1968 FAIR HOUSING LAW

New York law prohibits discrimination in the sale, rental or lease of housing accommodation on the basis of race, creed, color, national origin, sex, disability or marital status by the owner, lessee, sub lessee, or managing agent of housing accommodations or by real estate brokers and salespersons.

Real Estate Agents and Realtors are not alone in being subject to the Fair Housing laws. It is important for real estate buyers and sellers to know that they, too, are subject to most provisions of federal, state or local fair housing laws whether or not a real estate agent or realtor is involved in the transaction. In particular, racial discrimination by anyone in the sale or rental of housing is a violation of federal law.

 

UNDERSTANDING AGENCY RELATIONSHIPS

Before you enter into a discussion with a real estate agent regarding a real estate transaction, you should understand what type of relationship you wish to have with that agent.

SELLER’S AGENT: A seller’s agent acts solely on behalf of the seller. He or she has, without limitation, the following fiduciary duties to the seller: reasonable care, undivided loyalty, confidentiality, full disclosure, obedience, and a duty to account.  The seller’s agent does not represent the interests of the buyer.  The obligations of a seller’s agent are established between the agent and the seller in the listing agreement.  In dealings with the buyer, a seller’s agent should (a) exercise reasonable skill and care in performance of the agent’s duties; (b) deal honestly, fairly and in good faith; and (c) disclose all facts known to the agent materially affecting the value or desirability of property, except as otherwise provided by law.

BUYER’S AGENT: A buyer’s agent acts solely on behalf of the buyer. He or she has, without limitation, the following fiduciary duties to the buyer: reasonable care, undivided loyalty, confidentiality, full disclosure, obedience, and a duty to account.  The buyer’s agent does not represent the interests of the seller.  The obligations of a buyer’s agent are also subject to any conditions set forth in an agreement between the agent and the buyer.  In dealings with the seller, a buyer’s agent should (a) exercise reasonable skill and care in performance of the agent’s duties; (b) deal honestly, fairly and in good faith; and (c) disclose all facts known to the agent materially affecting the buyer’s ability and/or willingness to perform a contract to acquire seller’s property that are not inconsistent with the agent’s fiduciary duties to the buyer.

BROKER’S AGENT: A broker’s agent is an agent that cooperates or is engaged by a seller’s agent or buyer’s agent to assist the listing agent or buyer’s agent in locating a property to sell or buy, respectively, for the listing agent’s seller or the buyer agent’s buyer. The broker’s agent does not have a direct relationship with the buyer or seller and the buyer or seller can not provide instructions or direction directly to the broker’s agent.  The buyer and seller therefore do not have vicarious liability for the acts of the broker’s agent.

DUAL AGENT: A real estate agent, with the written consent of the buyer and the seller, may act as the agent for both parties. In such a situation, the agent will not be able to provide each party with the full range of fiduciary duties. The agent should explain the possible effects of this dual representation i.e. giving up their right to undivided loyalty.  A seller or buyer may provide advance informed consent to dual agency by indicating the same on this form.  Any individual should carefully consider the possible consequences of a dual agency relationship before agreeing to such representation.

DUAL AGENT WITH DESIGNATED SALES AGENTS: If the buyer and seller provide their informed consent in writing, the principals and the real estate broker who represents both parties as a dual agent may designate a sales agent to represent the buyer and another sales agent to represent the seller to negotiate the purchase and sale of real estate.  A sales agent works under the supervision of the real estate broker.  With the informed consent of the buyer and the seller in writing, the designated sales agent for the buyer will function as the buyer’s agent representing the interests and advocating on behalf of the buyer and the designated sales agent for the seller will function as the seller’s agent representing the interests of and advocating on behalf of the seller in the negotiations between the buyer and seller.  A designated sales agent cannot provide the full range of fiduciary duties to the buyer or seller.  The designated sales agent must explain that like the dual agent under whose supervision they function, they cannot provide undivided loyalty.  A buyer or seller should carefully consider the possible consequences of a dual agency relationship with designated sales agents before agreeing to such representation.

THE OFFER

An offer includes:

1. The Price.

2. The Terms.

a) Down Payment (the amount of cash you are prepared to invest in the purchase). The down payment on contract signing is traditionally 10% of the purchase price and some mortgages  (FHA)allow a 3% down payment.  The down payment is held in escrow by the seller’s attorney, until title passes.

b) Mortgage Contingency.  If there is a mortgage contingency, it is important to obtain pre-approval from a qualified lender.

c) Other contingencies, which may include, but are not limited to, inspections such as engineering, termite, water, radon, etc.

d) If the offer is cash, then proof of funds is required.

3. Verify all the inclusions and exclusions.

4. The closing date.

The seller may accept, reject, or counter any offer that you make. Your offer is strengthened by providing the seller as much information as possible including a pre-approval.

BUYER AGENT DUE DILIGENCE

When representing the buyer, the agent should perform the following duties:

  1. Obtain the seller’s property disclosure form through the listing agent
  2. Obtain termite contracts
  3. Verify the age of the structure, square footage
  4. Request a survey
  5. Confirm taxes and property assessments
  6. Check for any easements or zoning restrictions and flood zone
  7. Locate well and septic tanks
  8. Locate any underground storage tanks
  9. Verify property owners through tax records
  10. Verify utility bills
  11. Check for any environmental conditions on or near the property
  12. Check for any possible development in the area including street expansions
  13. Check the building department for any outstanding permits and C/O
  14. Check comparable values

 

THE INSPECTION

Once your offer has been accepted, it is strongly encouraged that you hold an inspection. Attending the inspection will give you information about the property’s present condition as well any repairs. We recommend that you hire licensed professionals to perform your inspections, such as engineers or architects.

ENGINEERING: This inspection covers the major structural elements of the home, out-buildings, and pool, as well as the heating, air conditioning, plumbing, and electrical systems.

TERMITE: This inspection should cover all wood-destructive insects. Inspection will be made of the home and all out-buildings. Your report should contain a certification of non-infestation and/or a report of any damage and recommended treatment.

RADON: Radon is an invisible, odorless and slightly radioactive gas that may seep into a house from the surrounding soil. High levels of radon have been found to be a health hazard after long exposure. In most cases, if radon is found, remediation is done, usually through a ventilation system.

ASBESTOS: This is a mineral fiber that once was used for insulation and fire protection. Fibers released into the air may be hazardous to your health. Asbestos in good condition may not need to be removed but covered and sealed instead. Any asbestos work must be done properly and by a properly trained and licensed contractor.

OIL TANKS: Underground tanks should always be tested. If gas is presently in use to heat the house, but you suspect that oil was once used to heat the house, it is prudent to check further about any abandoned underground oil tanks.

LEAD PAINT: Paint chips and dust from deteriorating lead paint are toxic and can cause lead poisoning when the particles are inhaled and ingested. In the case of houses built before 1978, the buyer and seller must, by law, be presented with the lead disclosures booklet and sign an acknowledgement that they have received the booklet.

CARBON MONOXIDE DETECTORS: New York State law requires that all one and two-family homes, condominiums, and cooperative apartments have at least one operable carbon monoxide alarm at the time of sale.

MEMORANDUM OF AGREEMENT

Once inspections have been completed and any and all issues have been resolved, the agents prepare a Memorandum of Agreement, which includes the buyers’ and sellers’ names and addresses, address of the property being bought, price, terms, closing date, inclusions and exclusions, attorneys and brokerages.

CLOSING

PRIOR TO THE CLOSING

After the contract is signed, if there is financing, the bank will order an appraisal.  In addition, prior to the closing, the buyer’s attorney will order a Title Search of the property and the appropriate Title Insurance policy. It may also be necessary to obtain an updated survey of the property. If you are financing your purchase, the lender’s attorney will need all required documentation before the closing date can be set. Your attorney will schedule the date, time and location of your closing with the agreement of the seller’s attorney and the lender’s attorney. Your attorney will advise you of the documents necessary to close. A preliminary closing statement will advise you of the costs and which checks must be certified. You should request your final “walk through” of the property just prior to the closing to assure yourself that it is in a satisfactory condition.

AT CLOSING

WHO WILL BE AT THE CLOSING?

You and your attorney, the seller and the seller’s attorney, the lender’s attorney, the title closer, and the Realtors involved with the transaction.

ITEMS TO TAKE TO THE CLOSING:

Checkbook

Picture Identification (Driver’s License, Passport)

Homeowner’s insurance policy and paid receipt

Certified Check for balance of proceeds

Certified Check for estimated title charges

All buyers must be present at closing to sign mortgage document (or a Power of Attorney)

SOME OF YOUR CLOSING COSTS

This is only a guide. Your attorney will discuss the closing costs with you.

1. Homeowner’s Insurance should be prepaid prior to closing.

2. Recording the Deed

3. Adjustments are made for fuel and utilities

4. Other Inspection Fees

5. Condominium Common Charges & Association Dues: Monthly fees apportioned at Closing.

6. Taxes: Apportioned between buyer and seller based on the fiscal year imposed.

7. Mansion tax (all properties with a purchase price more than $1 million are subject to a 1% tax of the sale price)

8. Mortgage Costs (include mortgage tax, appraisal fee, bank report, mortgage title insurance policy, points, mortgage recording fee, private mortgage insurance (PMI))

9. Purchaser’s Attorney Fee

10. Closer’s Attendance Fee

THE CLOSING

The attorneys and the title closer will review all documents and agree on the calculation of adjustments. It is the responsibility of the title closer to assure your attorney and the lender’s attorney of clear title to the property; that any mortgages, liens, and judgments presently on the property have been satisfied, that all taxes have been paid to date, that there are no violations on the property, and that a Certificate of Occupancy has been issued. When all necessary documents have been signed, all adjustments made, and the seller has received his or her monies, the deed and any other required documents are given to the title closer to file at the County Clerk’s office. You will receive keys to the property.  A Disclosure Estimate will be given to you by your attorney.  This shows the actual settlement costs.

CONGRATULATIONS!