How to sell your own home paperwork

If you decide to sell your home on your own or with a licensed real estate agent, you’re most likely going to have to use a promulgated TREC (Texas Real Estate Commission) form. There are many different documents used in Texas to sell a home, depending on a lot of variables. Here’s the top paperwork you’ll need.

 

Paperwork Needed To Sell Your Home

 

  1.     TREC One to Four Family Residential Contract (Resale)

This contract identifies who the buyer and seller are, property in question, sales price, financing terms, execution date, the issuer of the title policy, survey requirements, the close date, termination/option periods, special provisions, etc. Mainly this contract describes what the duties, performance requirements, and expectations are for each party involved in the deal. To further specify the details of the agreement, some additional Addenda could be added to this contract, depending on the needs and situation of the buyer and seller. REF Paragraph 22 of One to Four Family Residential Contract (Resale).

 

  1.     TREC SELLER’S DISCLOSURE NOTICE

As stated on the TREC Seller’s Disclosure,” THIS NOTICE IS A DISCLOSURE OF SELLER’S KNOWLEDGE OF THE CONDITION OF THE PROPERTY AS OF THE DATE SIGNED BY SELLER AND IS NOT A SUBSTITUTE FOR ANY INSPECTIONS OR WARRANTIES THE PURCHASER MAY WISH TO OBTAIN. IT IS NOT A WARRANTY OF ANY KIND BY SELLER OR SELLER’S AGENTS.”

 Essentially this is saying that the buyer should conduct their due diligence regarding the condition of the property. The Seller’s Disclosure notice is a generalized measure of the necessary information that the sellers must disclose to the buyer if there is a known issue to be discussed at all. If the seller is unsure about a particular component, typically the seller will mark ‘U’ for unknown. 

The problem with this is that the seller may honestly not know if there is a problem with any particular component, even though something may still be non-functional or defective. That is why proper due diligence is always necessary for the buyer. 

DISCLOSURE: It is always advised to consult your local real estate attorney regarding the legality of any real estate contract.

BUT THAT’S NOT ALL. THERE COULD BE OTHER ADDENDA related to the real estate contract

Some of the more common addenda associated with a real estate contract in Texas include:

 

  1. TREC Addendum for Seller’s Disclosure of Information on Lead-Based Paint and Lead-based Paint Hazards as Required by Federal Law

All homes built before 1978 require a lead-based paint addendum. The buyer of this home must receive this disclosure along with an EPA-approved pamphlet titled ‘Protect Your Family From Lead In Your Home.’

 

  1. TREC Seller’s Temporary Residential Leaseback

A seller may need the proceeds from the close of their current home to put down toward their next home. They could also need more time to stay in the property. In this case, a Seller’s Temporary Leaseback will allow the seller to remain in the home. It’s a benefit for the buyer and the seller. The seller has flexibility when transitioning into another living arrangement, and the buyer has the opportunity to purchase the home. The terms of the leaseback are related to the original contract and layout the cost of the leaseback. There could also be stipulations that the seller will endure penalties if they do not vacate on or before the termination of the leaseback. Some repercussions could be the loss of a few thousand dollars from the sale of the home held by the escrow company to ensure the performance of the leaseback, before issuing the money back to the seller. Also, the seller could get charged additional fees for each day they have not vacated the home. All terms of a between the buyer and seller. 

 

  1. TREC Addendum for Property Subject to Mandatory Membership in a Property Owners Association

If the property in question is in an HOA (Homeowners Association), the details regarding HOA fees and selling restrictions must be given to the buyer. Sometimes, HOA’s have the first right of refusal to purchase the property or can have some say as to who will be buying the property.

 

  1. TREC Third Party Financing Addendum

This addendum if for a Traditional real estate transaction where the buyer is under contract with the seller to purchase their home subject-to the buyer qualifying for financing to buy the home. If this addendum is in place, and the buyer cannot qualify to buy the house from a conventional lender, then they are no longer obligated to perform on the agreement.

 

  1. TREC Addendum Concerning Right to Terminate Due to Lender’s Appraisal

 Again, this would most likely factor in during the Traditional sale of your home. This addendum states that the buyer has the right to back out of the contract or renegotiate the sales price if the lender’s appraisal value is less than the agreed sale value of the home.

 

  1. TREC Addendum for “Back-Up” Contract

  This addendum is in place to ensure that the property in question has the best chance of closing in the case the original buyer was unable to close or completely backed from the purchase of the home. The secondary buyer is also under contract per the original purchase contract with the primary buyer and will be required to purchase the home subject-to the primary buyer being unable to perform to the requirements of the original contract. 

DISCLOSURE: It is always advised to consult your local real estate attorney regarding the legality of any real estate contract.

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