Real Estate Checklist for Buyers

Checklist of matters for the Buyer to consider and investigate:

  1. Is the purchase price fair: Have you house-hunted sufficiently to feel qualified to judge and, if not, have you seen the FHA appraisal or hired an appraiser to determine the fair market value?
  2. Examine the Seller's old title insurance policy in the exceptions section to determine whether any restrictions of record are offensive to you or to determine whether any easements interfere with your planned use of the property. When you so examine, copy the legal description (usually the "Lot--Block--in _____'s Addition" section) so you can give it to the City Engineer and City Treasurer when you question them as outlined below.
  3. Check with the City and/or County Engineer and Planning Department on zoning in the area and whether any assessments are planned for the future.
  4. Check with the City and/or County Treasurer to determine the amount of assessments (for paving curb, sewer, etc.) outstanding that you are assuming and water bill is paid at closing from Seller's proceeds.
  5. Satisfy yourself that no major improvements have been made on the property within the last eight months; if so, that they are all paid for (labor, materials and contractors).
  6. Be certain the Sellers are over 21, that they are competent, and that they do not have a poor reputation.
  7. Check to see that any mortgage assumed is in the amount stated.
  8. Verify that the closing agent, usually a title company, pays for any mortgage or assessment not assumed out of the purchase price.
  9. Question anyone living on the property, other than the Seller, to determine his rights in the property (e.g., in regard to prepaid rent or leases, etc.).
  10. Verify with the fire insurance agent that you have fire insurance coverage the moment you assume the risks of ownership. Let him see the contract.
  11. Have earnest money held by the Seller's attorney or broker--not by the Seller--and do not deliver earnest money until you have a contract.
  12. Be sure that all items of movable property being sold (e.g., range, refrigerator, cooler, curtains, rugs, TV antennas, etc.) are spelled out in the contract to pass with purchase.
  13. If a business property or apartment house property is being purchased, see that personal property tax problems are spelled out and that chattel mortgages are not outstanding.
  14. Is there a termite problem? Are there sewers over adjacent property? Are there paths or roads or pipelines used by others over the property?
  15. Have you agreed and is it specified in the contract how payment is to be made for title insurance, transfer taxes, assessments outstanding, escrow charges, charges to prepare the contract, and mortgage assignment charges?
  16. If you are buying on installment and the land is vacant, see that your real estate contract is recorded.
  17. At closing, be sure you obtain the Seller's insurance policies if you are taking them over and be sure you obtain any leases and a transfer of the security/damage deposits if the property is tenant-occupied.
  18. When the papers are ready, have your attorney examine them. You should have your attorney examine the Receipt and Option Contract BEFORE YOU SIGN IT.
  19. As a part of obtaining a new mortgage, check with the lender regarding mortgage insurance. Under certain circumstances the insurance can be cancelled or never charged in the first place where the loan amount is less than 75% to 80% of the value of the property and private mortgage insurance is being or will be maintained. The premium for this insurance is usually 1/2% per month on the unpaid principal balance or an up front premium of several thousand dollars.
  20. The purchaser should consider having the home inspected for structural integrity, functioning of heating, plumbing and electrical systems, for aluminum wiring, for radon gas, asbestos, lead in paint. Where property other than a single-family residence, is purchased you must do an EPA Environmental Audit.

    This is titled as a Farm and Ranch Guide to Environmental Auditing; the considerations given are applicable to any property for which an Environmental Audit is recommended. The following link is to a paper on the progress of the new rules for all appropriate inquiry: Click here.
  21. The following link: is to a site which has a paper titled "Disclosure Duties In Real Estate Sales And Attempts To Reallocate The Risk" by Florrie Young Roberts of Loyola Law School (Los Angeles) dated May 9, 2001.
  22. The Real Estate Commission approved forms generally provide that the buyer is purchasing the property "AS IS." You should discuss the consequences with your attorney if you have any questions.
  23. Check with the county assessor's office regarding any special improvements districts.

The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.