Purchase & Sales Agreement | Attorneys | Day of Closing
We hope you have a great experience buying property on Martha's Vineyard. We're here to help you. In July of 2005, the laws in the state of Massachusetts changed. We are now able to represent you, the buyer, throughout the buying process. Island Real Estate works honestly and fairly with every customer and client. We are members of the Board of Realtors® and adhere to a strict code of ethics. We will explain how the process works and assist you throughout the transaction.
The following information will help you with the process. Please feel free to ask us questions whenever they arise.
The process begins with you, the buyer, finding a home you would like to buy. We are able to show you every property listed for sale on the island. It is best for all involved if you choose one agent to work with throughout the process and stick with them. We cooperate with all brokers on the island. If you find a listing you are interested in seeing, but notice that it is listed/advertised with another agency, we can make an appointment for you to see the property. It gets complicated if you start with one agent and then jump from office to office; Martha's Vineyard is a small island and all agents cooperate with each other.
|Offer To Purchase|
When you are ready to make an offer on a property, your agent will type an Offer to Purchase for you. This is a legally binding contract. This document spells out the terms and conditions of the offer; such as the price you are offering as well as contingencies (conditions). A contingency in an offer is there to protect you in the event that one of the terms cannot be met. Examples of contingencies are as follows: a home inspection, mortgage contingency (if financing is necessary), septic inspection. When you are ready to sign the Offer to Purchase, a good faith binder must accompany the paperwork. The binder is usually $1,000. This will show the seller that your intentions are serious. Your agent will go over the contract with you and discuss the time frame for each contingency that needs to be met. This document is a legally binding contract. If you do not understand the terms of the contract, please consult your attorney.
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We recommend that you have a home inspection done by a certified home inspector to protect your investment. Since real estate agents are not home inspectors, there may be a defect to the property that only a home inspector or contractor would notice. A home inspector will examine the interior and exterior of the home, including the roof, structural supports, and windows, the plumbing, heating, and the electrical workings. They will also note the presence or absence of bugs/pests. If this is beyond their realm of expertise and they see a potential problem, they will refer you to a bug/pest inspector. At the conclusion of the inspection, the inspector will give you a written report on the property for you to review. A home inspection is not meant as a tool for renegotiation, but to inform you, the consumer, on the condition of the property you are purchasing. A home inspection is usually done within two weeks of acceptance of an offer. Home inspections typically cost $500 -$1,000. This cost is paid by the buyer and is the property of the buyer. Agents are not allowed by law to recommend a home inspector unless they are working as a buyer's agent. Please go to the web www.state.ma.us/reg/boards/hi to find a qualified inspector.
The Land Bank fee is a cost to the buyer at closing. The fee is 2% of the purchase price. The money collected by the Land Bank is used to purchase land that will be forever unbuildable on the island. This agency has protected the integrity of the island. There are walking trails throughout the island that are open for all to enjoy. Only buyers who are purchasing a home for the first time are exempt. They are exempt from the first $300,000 and must keep the property as their primary residence for at least five years.
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|Title V - Septic Systems|
The majority of homes on the island have septic systems. Typically it is the Seller's responsibility to supply a Certificate of Compliance for the septic system at closing. Septic systems have strict guidelines in the state of Massachusetts called Title V. If a septic system is a failed system or needs repairs or updating, the seller may be willing to negotiate the selling price of a home according to the cost of repairing/replacing the system. If it becomes the responsibility of the buyer to bring the septic system up to Title V standards, it must be completed within 60 days after closing.
|Purchase & Sales Agreement|
When both parties agree to the terms and conditions of the Offer, the seller will have his or her attorney draw up a Purchase and Sales Agreement. This document is more detailed than the offer. At the signing of the Purchase and Sales Agreement, the balance of the deposit money that was written in the Offer to Purchase will be paid.
We recommend that you hire an attorney to review the paperwork and assist you with the closing. The attorney you choose will also take care of a title search as well as title insurance. Local attorneys are familiar with local real estate laws and regulations and may be able to help you better than an off-island attorney. We can give you a list of attorneys to assist you.
|Day of Closing|
As it gets closer to the date of closing, make sure you contact an insurance company to insure the property. You will also need to call the electric company, the gas or oil company, the cable company, and the water department (if you have town water).
On the day of closing, you will meet your attorney at a specified time and place. You may consider taking a final walk through of the property. The signing of the documents usually takes place at the lawyer's office. Make sure you speak with your attorney prior to the day of closing so that you have the correct amount of money needed at the closing table. All funds at closing should be certified funds or a cashier's check. In some instances, funds may be wired directly to the attorney's bank account. After all paperwork is signed, you can take possession of your new home.
If there are ever any questions throughout this process, feel free to contact your agent at Island Real Estate. We look forward to working with you!