Real Estate Accounting 101 – For Your Mission Viejo Home Purchase
Who Pays for What in a Mission Viejo Home Purchase?
One reason the California Residential Purchase Agreement, used in most Mission Viejo home purchase transactions, is 10 pages long is that it includes a designation of who pays for each of the various bits and pieces that are required in most Mission Viejo home purchases these days. And just so you have the handy the next time you go to buy or sell your house, here’s a list of what someone has to pay for in most Mission Viejo home purchases.
Escrow fees – in Mission Viejo home purchases, it is customary for the buyer and seller to each pay their own escrow fees – which are usually identical and calculated based on the purchase price of the home. This exact dollar amount is not mentioned in the contract, just who pays for who’s.
Home Warranty Policy – it is customary for the seller to pay the cost of a one year home warranty policy for the buyers for an amount that is designated in the contract. The buyers can elect to add on other coverage such at the roof, the washer and dryer and refrigerator, the cost for which can be added on to their closing costs.
Natural Hazard Zone Disclosure Report – it is customary for the seller to pay for this report for the buyers, which is compiled by a third party company and indicates such things as: if the house is in a soil liquefaction area, or on a seismic fault line, or in a high fire hazard area.
Owner’s Title Insurance Policy – It is customary for the seller to pay for an insurance policy to cover the home against any unforeseen title issues when they pass the property on to the buyers.
Termite Inspection and Repairs – It is customary for the seller to pay for the cost of a termite inspection and the cost to take care of any items that appear in Section 1 of the termite report.
Water Heater Strapping and Bracing, Smoke Detectors, Carbon Monoxide Detectors – It is customary for the seller to pay the cost of properly strapping and bracing the water heater, and having the right number of smoke and CO detectors in the right places. If any of these are not up to snuff, the home inspector will also note these in his report. And the buyers typically include an item in their request for repairs to call it to these sellers’ attention.
Local Transfer Taxes – It is customary for the seller to pay any applicable property transfer fees, which the main one for Orange County.
HOA Transfer Fees – If the home is under the governance of a Home Owners’ Association, it is customary for the seller to pay the fees required to transfer the property from one owner to the next, and to pay to provide the buyers the Covenants, Conditions, and Restrictions (CC&R’s), and a year’s worth of financial statements and meeting minutes.
Home Inspection Report – It is customary for the buyers to pay for the home inspection and provide the report to the sellers.
Home Appraisal – It is customary for the buyers to pay for the home appraisal required by their lender in a Mission Viejo home purchase when the buyer is taking out a loan to make the purchase.
Of course, these are all negotiable.
I’m Leslie Eskildsen, Realtor.
Call me. Text me. 949-678-3373
Email me. Leslie@LeslieEskildsen.com
Helping you make the right move in Mission Viejo, Coto de Caza, Rancho Santa Margarita, Irvine, Laguna Niguel, Laguna Hills, San Juan Capistrano, San Clemente, Laguna Beach, Newport Beach, Dana Point, Corona Del Mar, and other Orange County communities.