Frequently-Asked Questions About Selling A Home In New Jersey
Selling a home is stressful. Instead of trying to protect your legal interests on your own throughout your sale, rely on the experienced guidance at Mariano & Coiro, P.C.. Our team is here to answer your questions and ease your mind about the process. To help you get the information you need, we have taken the time to answer some of your more common questions here:
Do I need my attorney to review the contract before I sign it?
New Jersey has a three-day review period for any real estate purchase or sale contract presented by a licensed realtor. Hence, under New Jersey law, all parties sign the realtor prepared contract FIRST—then the contract goes to the attorneys for review and modification. If your real estate transaction does not involve a realtor, you should NEVER sign any document without having your attorney review it first, as there is no automatic three day attorney review protection.
Will my closing date be the same as the closing date in the contract?
The date listed in your contract is merely an estimated or “target” closing date. To coordinate lender schedules and other closing efforts, the buyer or seller typically has the right to extend the target closing date up to 14 days. In few instances, a contract will stipulate a “time of essence” closing, which is a mandatory closing date. Time-of-essence closings, though, are very rare.
When does the attorney review period start and conclude?
Once the realtor prepared sale contract has been executed by and delivered to all parties, the three-day attorney review period officially begins. The three-day period only takes place on business days. For example, if the contract is executed on a Friday evening, your attorney will have a three-day period beginning Monday to review it.
If no action is taken by either attorney during the three day review period, the contract will become binding as signed. However, once either attorney submits a “review letter” to the other attorney during the three day period, the review period then remains “open” until it is closed by agreement of both attorneys. Hence, the review period, once initiated by either attorney, can be less than three days or extend beyond it, depending upon the agreement of the attorneys.
It is also critical to note that under the law, either party has the right to cancel the contract without incurring any penalty, provided the cancellation occurs during the three day attorney review period or before the review period is deemed concluded by the attorneys.
While the review period is in progress, you can continue to market and show your home to prospective buyers, provided you make it clear that you are in attorney review with another party, and that you may only accept any new offer as a “backup offer”. If you receive a better offer during the review period, notify your attorney immediately. You cannot sign another contract with a different buyer until your lawyer formally cancels/terminates the existing/prior contract.
What should I know about inspections?
Buyers have the right to conduct inspections of the property. There are several types of inspections, the most common being:
- Structural and mechanical
- Termite and wood-destroying insects
- Radon and environmental
Most lenders require a full inspection of the septic system or pool of any property that has these. New Jersey also mandates a full inspection of well water for any property that has a well, which is typically the responsibility of the seller. Buyers are entitled to complete a walk-through inspection of the property within 24 hours before closing, to ensure that the home is in the same basic condition and that any agreed upon repairs have been made.
Generally, real estate buyers have up to two weeks to complete their inspections. Then, they can provide the seller with a list of flaws, deficiencies or requested repairs. As the seller, you have the right to negotiate the repair or modification of these issues, especially when it comes to large, expensive repairs. If an agreement cannot be reached with regard to legitimate defects, then either party has the right to cancel the contract, at which point the buyer receives a refund of the deposit and the seller is then free to again market the property for sale.
Is it necessary to have a certificate of occupancy? Is it necessary to have a smoke detector certification?
In New Jersey, sellers of residential properties must comply with established smoke detector, fire extinguisher and carbon monoxide regulations. This involves having a Municipal inspection to ensure compliance. Depending on the city and county in which the property is located, you may also be required to obtain a Certificate of Occupancy (CO), a more comprehensive municipal inspection of the home’s systems and components. You must obtain these passing certifications by the closing date or you cannot proceed with the closing.
It is crucial to act quickly to obtain these certifications, especially because most municipal inspectors only conduct inspections one or two days per week. If your smoke detectors and carbon monoxide detectors do not work for the inspector, you will have to schedule a reinspection. It is important to test these items in advance yourself, to make sure they are in working order. This will save the time and expense of an additional inspection.
Once obtained, the required certifications are usually valid for up to 6 months. Hence, it pays to get started early to avoid last minute “drama” and consternation prior to closing.
Before I close, should I make a payment on my existing mortgage? How will I pay off my existing mortgage?
Yes, you should pay your existing mortgage and any other property related fees due (such as HOA fees). If you do not pay these items by their due date, you may be subject to additional fees and damage your credit score. It is best to make any payments as soon as possible instead of trying to time the mortgage payment and the amount due at closing. The remaining balance of your existing mortgage and all other property related expenses will be paid in full at closing.
At the closing, what do I need to bring?
When you work with our office, we can have you come to our office and sign all necessary documents for your closing in advance. This way, you do not have to attend the closing in person – no need to take time off work or make child care plans. Please provide the certificate of occupancy, the smoke detector certification, and most importantly, the keys. Are you selling a condo? Please also provide any public offering statements, HOA documents, maintenance fee coupons and pool badges, etc. We will complete the closing for you.
Does my home need to be in a certain condition when I leave it?
Your home should be in “broom clean” condition. What does this mean? It should be in the same condition that you would expect from a brand-new home. Collect all your personal belongings, thoroughly vacuum and clean all rooms, wipe down appliances and remove debris.
Do not leave garbage or yard waste in the bins on the curb for routine pickup. If it is summer, mow the lawn. In autumn, rake the leaves from the lawn; in the wintertime, shovel all ice and snow from the walkways of the premises. Make sure the home is in the same condition you would like if you were moving into it.
What are the closing costs of a sale?
On the closing day, you will pay the realtor’s commission as well as any legal fees; these sums will come from your overall proceeds, as will the payoff from your existing mortgage. The amounts for taxes, water and sewage will also be pro-rated from your proceeds. Sellers in New Jersey must also pay a realty transfer fee; this is essentially a sales tax on the property based on its selling price.
Let Us Help You Through Your Sale
If you are ready to proceed with your sale, call us at 732-860-7620 or email us here. The sooner you schedule your initial consultation, the sooner you can close the sale of your home.