Real Estate 101

TIPS FOR HOME SELLERS:

1) Send me the most recent copy of your house deed, title policy, property survey, certificate of occupancy and tax bill. While I can order these materials from public sources, getting them may take several days. When I have these materials, I can prepare a contract tailored to your transaction. Less time will be spent in negotiating contract points that could be resolved by simply checking your documents.

2) Have you improved your home? Tell me if you’ve changed your house since buying it. Have you added a dormer or finished a basement? Many home improvements require building permits. Your sale may be delayed if we need to get permits, electrical underwriter’s certificates, and town approvals.

3) Do you have an underground fuel tank? Tell me if you have an underground fuel tank, or know of one on your property. Few buyers will risk buying property with a buried tank that may one day leak oil. So we’ll need to discuss how to abandon or replace your tank.

4) Have you applied for or been turned down for a property variance from the Zoning Board of Appeals? If so, you should provide me with a copy of their determination.

5) Do you have a mortgage? Send me a copy of your mortgage statement. I will contact your current lender to determine your outstanding loan balance which will be paid off at closing.

6) Will you qualify for a tax-deferred exchange? If you will be using your sale proceeds to purchase another property, let’s discuss a tax – deferred exchange. That vehicle may allow you to defer the payment of taxes on your profit.

7) Are you having a property dispute with your neighbors? If so, we should discuss the problem.

TIPS FOR HOME BUYERS:

1) Inspect the house with a licensed inspector or engineer. Be present for the inspection. Ask the inspector about any aspect of the house that puzzles you. You should also have a termite inspection and water test performed if the house is serviced by well water.

2) Will you be changing the house? Tell me if your purchase depends upon expanding the house or adding a garage or pool. We may need to survey the property to confirm that you can do it without violating zoning regulations.

3) Have you been told anything about the property? I’ve had clients who were misinformed about what could be built on an adjacent lot, the size of a property, the age of a house, and many other issues.

4) Are you getting a mortgage? If you’ll need a mortgage, familiarize yourself with your lender’s loan process. Self-employed borrowers must produce more and different documents than wage earners.

5) If you need local referrals ask me. I can suggest people who can help you with any aspect of the transaction.

STANDARD TRANSACTION COSTS:

1) Mortgage Tax

usually paid by the Borrower. Residential Property
Amount of loan multiplied by .008, less $30.00. Commercial Property
Amount of loan multiplied by .001050.

2) NYS Transfer Tax – usually paid by the Seller.

$4.00 per $1,000.00 of sale price.

3) Peconic Tax – East Hampton, Southampton and Shelter Island, usually paid by the Purchaser.

Improved Property – deduct $250,000.00 from purchase price and multiply by 2%.
Vacant Land – deduct $100,000.00 from purchase price and multiply by 2%.

4) Mansion Tax – usually paid by the Purchaser.

Multiply purchase price by 1%.

5) Other Closing Costs:

House Inspection
Termite Inspection
Water Testing
Surveyor
Title Company
Bank fees
Attorney fees

Real Estate 101

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