Filling out the Professional Services Disclosure and Election Form
This form is filled out near the end of the transaction to include all vendors used and who recommended them. It covers basic liability for our firm and is required to close out our file.
Accountant / CPA / Tax Advisor: It’s quite rare that someone uses an accountant when buying real estate unless it’s cash and they usually have their own already in place. Is often used when doing a 1031 exchange and need tax advice. When getting financing, your lender will have their own process for getting pre-approved so this is checkbox is normally waived. Price depend on what you need done.
Appraisal: Lenders require it and it’s ordered by the lender. Cash buyers rarely do an appraisal but it does happen if they want to make sure it is worth the price they’ve offered. Usually between $500 – $600
Attorney: You always use an attorney to buy real estate in North Carolina. You can use one we suggest or one that you find on your own. You can use whomever you want. We use Goosmann Rose. If you have an attorney your prefer, I’m happy to use them or I can suggest some for you. Price range depends on the property type and financing method. A cash deal is less due to less paperwork. Closing is less expensive on the sellers side. It usually ranges on buyers side from $1200 – $1800 is the normal range. If easements and other paperwork needs to be drawn up it can cost a bit more.
Home Warranty: Often offered by the seller. The most common place you see in home warranties is new construction, usually offered by the sellers. Buyers rarely get their own but can. They can be useless. Insurance policy to fix things (like fridge, stove, HVAC.. etc) Caution against. Prices often range from $500 – $600 for a 1 year warranty. Look into it. Cost is usually same to fix oneself. (add options / cost range here) Here’s a link for more info. Link to provider.
Inspections
First thing is see which inspections the lender requires, and do those. If there is no lender, then inspections are entirely up to you as the buyer.
Home: I always recommend a full home inspection. The cost is around $350 – $550 for a standard inspection (price depends on size of home, traveling involved and scope of project). Here’s one we use:
HVAC – Generally the home inspector will do a preliminary inspection on the HVAC to determine age and life expectancy. I there is an issue, then you want to get a licensed HVAC service provider out there. Often if it’s working, clients don’t order a HVAC inspection. Can ask the seller if there’s a maintenance schedule for it. (Often people do spring and fall) If you have any concerns we can order it. (add cost range / options here/ look into service call fee for HVAC person. Prob a few hundred)
Pool / Spa: When a pool or spa is present, you can order an inspection to determine age and life expectancy. (autumn has ordered one to get quote on changing system out) (add options / cost range here). Usually a specialty pool guy.
Radon: If there is a crawl space we’re generally not too concerned, about radon, but if there’s a basement or a slab (concrete slab on the ground) then it’s a good idea to have it done. Cost: $150 – $200 on top of home inspection and Is usually done by home inspector. (define radon) Odorless colorless gas which is emitted from granite which is prevalent in Western North Carolina .. so anytime you disturb the ground the radon naturally. If there’s a large amount of radon it needs a place to escape. If there are unacceptable levels of radon, they can have a radon mitigation radon systems installed.
Septic: If the lenders require it then it must be done. Usually cost is around $400 – $800 depending on difficulty in accessing and size of the system. If everything seems normal, it’s up to buyers if they want to spend the money or not. But we always recommended that you get it checked out.
Ask selling agent if they have records from when the septic was pumped. If just pumped, it’s up to you. (One line for each bedroom). If it’s just pumped, they often visually inspect it. If they had it done could they send the receipt or report on it? If not recently done, they can have it done. They will pump and inspect. It’s from $400 – $800. It’s nice to know when you first start that it’s ready to go. If everything seems normal, it’s up to them if they want to spend the money or not. Some people have them for over 30 years and have not serviced the septic so it’s up to them. Find the septic permit under environmental health permits. Find the drawing of it. Do the research for them. Sometimes lenders require it.
Well / Water Quality : If the lenders require it then it must be done. Some banks require a water test if it’s on well water. If everything seems normal, it’s up to buyers if they want to spend the money or not, but we always recommended that you get it checked out. Price ranges depends on scope of work (basic test starting around $80). Here’s a link for more information. https://wncil.com
Wood / Pest Inspection: Most lenders want a pest inspection. If the lenders require it then it must be done, though we always recommend getting one done. The cost is usually around $100 – $150 and is normally done by the home inspector.
Worth the $100. If home needs to be treated, it can be $800 – $900 which we can negotiate for during Due Diligence.
Re -Inspection: If a repair is finished, you have the option to have a re-inspection done should you choose to. For most repairs, a receipt from a licensed contractor is sufficient proof work was completed in a craftsman like manner. A re-inspection is recommended for major issues such as foundation or anything involving a structural engineer. Cost will likely be the same as initial inspection.
Insurance
Property Insurance. YES. Always required for a loan. Should get property insurance (Bank may have preferred insurance providers). Will be escrowed in their mortgage. Does their bank set it up or do they use their own person? Use their own person, check with car or renters insurance provider. Will be part of their mortgage payment paid out by bank) (not required if cash, but buyers always get it if there’s a structure). Will be his own policy. (General insurance on Haywood is good) (add options w/ links here)
Property Insurance is always required for a loan, and is always recommended regardless (though rarely used for land). The buyer always sets this up and can often get this through their car insurance company. This is part of the mortgage payment if they have a loan. If it’s a cash deal, then you pay it separately because there is no loan. Usually ordered right before close. Usually takes a couple days to set up. Cost is on average $100 a month and is rolled into the mortgage payment.
Flood Insurance: Normally a listing agent does this. Look up. FEMA Flood maps. 2 buttons. Type national flood hazard layer. Search the address. It will take a moment too overlay a flood map. Check legend for a flood zone. Screenshot the map and keep it. Not in flood zone, no need for flood insurance.
National Flood Insurance Program, Elevation Certificate: Required if the property is in a flood zone. When you get flood insurance, they will issue a certificate.
Mortgage Loan: Insurance because bank is taking a risk on it. Part of mortgage. PMI.
Survey: I always recommend that buyers get a survey done. This ensures that you know exactly what you’re buying and there are no encroachments with other properties. A survey will tell you where your land lines are and confirm how much land you are getting.
Case by case basis. Always a good idea to get one. If there’s a recent one, we should be in good shape. Seller is completing a survey before closing. Case by case. Piece of land (always get a survey!) Modern surveys are super accurate, 50 years ago it was a lot more clunky. Metes and bounds. Good to do because you never know. If it’s a subdivision they don’t often order. Want to build something on it.. def get a survey. If they need peace of mind, do it.
Examples: 30 acre survey was $9,000. 1 acre around $1,200 – $2,500 if everything is in place. Subdivision is less likely to need a survey. $1,800 for the 1 acre line. Never less than $1,500. 70 acres was $13,000 as a friend price.