Home sales in Rhode Island can be risky if you do not follow all state and local regulations, and doing it yourself may lead to serious legal problems. Before you sell your home, consider what you need to know.
Benefits of a Real Estate Agent
A seller’s real estate agent has the resources to accurately assess the current value of comparable homes in your area and can effectively market your house. Locate a licensed real estate agent at Realestateagent.com.
The Listing Agreement
There are three kinds of real estate listings:
- Open listing: Owners retain the right to sell the home and pay no commissions.
- Exclusive agency listing: Owners execute a listing agreement with a broker and pay a commission only if the broker is the procuring cause of the sale.
- Exclusive right to sell listing: The seller pays a commission to the listing broker regardless of who brings in the buyer.
Your agent determines the selling price by comparing prices of similar homes that have been listed in your immediate area.
Most listing agreements contain:
- Price and commission
- Items included or not included in the sale
- Duties and obligations of seller and agent
Seller’s Required Disclosures
The seller must disclose known defects in the home’s structure, as well as the following:
- Length of occupancy and year built
- Systems—electrical, sewage, heating
Your failure to make the required disclosures can expose you to a lawsuit. Home sellers generally use the Rhode Island Real Estate Sales Disclosure Form. Generally, if an inspection turns up material defects, the buyer can insist that you remedy the defect or lower the purchase price.
What to Do With the Offer
An offer is made by a potential buyer to pay a certain price based on certain terms and conditions. It becomes a legally binding contract when the seller accepts the offer and notifies the buyer of its acceptance. A counteroffer is one that rejects the original offer and presents a new offer. Once the terms of an offer are agreed upon, it goes into escrow where the buyer deposits certain funds into an escrow account along with instructions.
Clarifying the Purchasing Agreement
A purchase agreement is a legally binding contract containing, and includes:
- Identity of the parties involved in the transaction
- Price terms
- Financing terms
- Guarantee of clear title
- Potential inspection and closing dates
The House Closing
At the close of escrow, the following events occur:
- The buyer signs a promissory note
- Costs and fees are paid
- All documents are signed and transferred
- The deed is recorded
Sellers need not be present at the closing so long as all costs are paid and documents are signed. You will typically have to turn over the keys to the buyer the same day as the closing or when you obtain occupancy.
Importance of Consulting a Real Estate Lawyer
This article is only a short review of Rhode Island real estate law. Property laws and regulations are not the same in each state, so you should consult a real estate attorney for specific legal advice.