The contract

• The purchase and sale of residential real estate begins with a written contract of sale or purchase agreement.
  
• In the contract the buyer agrees and the seller agrees to transfer a specific piece of real property for an agreed amount of money.

Attorney Review

• In New Jersey, contracts prepared by real estate brokers and signed by the buyer and seller are not legally binding for three business days from the date the buyer and seller receive a signed copy of the contract.
  
  • Contracts prepared by attorneys or by the parties themselves may be valid immediately after being signed.
• During the three day “attorney review”:
  
  • The contract can be canceled by either the buyer or seller;
    
  • The terms of the original contract can be changed or new terms can be added by agreement of both the buyer and seller in writing;
    
  • If the contract is not canceled by the end of three business days, it is a valid contract.

Pre-closing Inspections

The sale of property is generally under the principle of "let the buyer beware".
A seller does not have to inform the buyer of any problems with the property except:

• Whether there is a lead paint hazard on the property, or
  
• The results of any radon test performed on the property.

• Home inspection -
  
  • A professional inspector examines the property to find the condition of the structure and to identify any problems that need to be fixed.
    
  • The inspection may include review of the condition of the roof, siding, fireplaces, chimneys, electrical systems, plumbing, insulation, appliances, central heating and air conditioning units.
    
  • Termite inspection.
    
  • The property is examined for termites, termite damage and evidence of previous termite damage that was already repaired.
• Radon test-
  
  • Radon is a form of gas from underground radium beneath a house. If the radon level exceeds a certain amount it is considered dangerous and may require steps to decrease the hazard called “remediation.” In New Jersey, a radon level of 4.0 picocuries per liter is considered a dangerous level that requires action.

Title Issues

The buyer should have a title search done to make sure that the seller has the right to transfer the property.

• If the buyer is financing the purchase of the home through a bank, the bank will usually require the buyer to have a title search performed.
  
• The purpose of a title search is to determine:
  
  • If there are any liens (including federal tax liens for unpaid taxes), bankruptcies, judgments or lawsuits filed against the buyer or seller;
    
  • If all real property taxes are paid;
    
  • If either the buyer or seller has any outstanding child support payments due;
    
  • If the sellers filed the necessary permit applications and received a "certificate of occupancy" for any remodeling or additions to the property;
    
  • If the seller is the actual owner with the right to sell the property.