18 important points of negotiation when making or receiving an offer on a Single-Family Home in Texas
Negotiating an offer to purchase or sell a home is much more complex than most consumers recognize. Below I have listed 18 opportunities for negotiation on the Standard TREC 1 to 4 Family Residential Resale Contract. Not fully understanding each point of negotiation and how they affect the overall closing of the transaction could cost you Time, Money or the Sale or Purchase of your home altogether
1. Improvements (Line - 2 D. of Contract) – Are there items such as TV mounts, antique lighting fixtures, specialty doors or any other fixture that the seller intends to take with them when they move? Will the seller replace the removed items with new acceptable items before they move?
2. Mineral Rights (Line - 2 E. of Contract) – Does the seller still own the mineral rights to the property? Will the mineral rights convey to the new buyer or stay with the seller? (Addendum would be required if the seller wishes to maintain mineral rights)
3. Sales Price (Line - 3 of Contract) – What is the total purchase price? How much down payment will the buyer provide? How much in financing will the buyer require? (Addendum would be required if the buyer is using financing)
4. Earnest Money Deposited (Line 5 of Contract) – How much earnest money will the buyer deposit with the title company?
5. Title Company Used (Line 5 of Contract) – What title company will be used to close the transaction?
6. Title Policy (Line 6 A. of Contract) – What title company will provide the title policy? What type of tile policies will be provided? Who will pay for the title policies “Buyer or Seller”?
7. Survey (Line 6 C. of Contract) – Can an existing survey be used to close this transaction? If not, who will pay for the new survey?
8. Title Objections (Line 6 D. of Contract) – How many days will the buyer have to review the title disclosure? What prohibited use or activities will be included as possible objections?
9. HOA Documentation (Line 6 E. 2 of Contract) – Is the home being sold subject to mandatory membership in an HOA? If so, will the HOA addendum be used as part of this contract?
10. Sellers Disclosure (Line 7 B. of Contract) – Is a seller’s disclosure required? If so when will the seller's disclosure be provided to the buyer?
11. Upfront Repairs (Line 7 D. of Contract) – Is buyer requesting upfront repairs or treatments even before the inspection is complete?
12. Home Warranty (Line 7 H. of Contract) – Will the seller contribute funds to purchase buyer home warranty?
13. Closing Date (Line 9 A. of Contract) – What date will buyer and seller close on the home?
14. Buyer Take Possession (Line 10 A. of Contract) – When will the buyer take possession of the home? If buyer or seller need a temporary lease an (Addendum would be required)
15. Special Provisions (Line 11 of Contract) – Is there a detail that needs to be added in Special Provisions, applicable to the specific offer at hand, that TREC has not promulgated a form, lease or addendum for?
16. Seller Paid Closing Cost (Line 12 A. of Contract) – Will the seller contribute funds on behalf of the buyer to help pay for the buyer's cost of closing on the home?
17. Addenda to Contract (Line 22 of Contract) – What Addenda are being used with this specific transaction? Many Addenda are required by law or being used as best practice for the buyer or seller.
18. Option Period (Line 23 of Contract) – Will the buyer have an unrestricted right to terminate the contract? (Typically used to have the home inspected) If so, how long will the option period last? How much will the buyer pay the seller for the option period?
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