Have you ever wondered which documents you need to keep after buying a home? Afterall, there is a file several inches thick by the time you get your keys! No one wants to start life in a new home with trash and clutter, right?
If you bought your home with DIGGS you don’t need to worry. We keep your documents secure, available at a moments notice. I once helped a divorcing woman obtain a document from her home purchase with me 10 years in the past- and I did it in 5 minutes while in the car!
But I digress. Realtor.com published an article about the 8 critical documents you need to keep and ONE document surprised the heck out of me! Scroll to the bottom of this post to find out which one it is!
Here are the documents mentioned by Realtor.com and the reasons for keeping them.
1. Buyer’s agent agreement
When you choose a real estate agent, you sign a buyer’s agent agreement—a contract between you and the brokerage, stating that the agent represents you in the purchase of your home.
This agreement outlines the terms of the relationship with your agent—including who pays the agent’s commission (in most cases, the seller), the length of the agreement (90 to 120 days is standard in most markets), and the terms for terminating the agreement.
Why you should keep it: This contract spells out what services your agent agreed to provide you with—and it can come into play if you have an issue with your agent after the transaction closes.
2. Purchase agreement
Every home sale starts with a real estate purchase agreement—a legally binding contract signed by home buyers and sellers that confirms that they agree upon a certain purchase price, closing date, and other terms.
Why you should keep it: The provisions stated in this contract must be followed to the letter. If you or the seller fails to fulfill these duties, there could be legal ramifications.
3. Addenda, amendments, or riders
These types of documents alter or amend the terms of your purchase contract. For example, if a survey reveals that there’s an encroaching fence built by a neighbor, and you’d like the fence removed, the sales contract has to be formally amended.
Why you should keep them: Addenda, amendments, and riders are often related to home inspections or appraisals, and because they change the original terms of the signed contract, they’re worth holding onto.
For instance, if both parties signed a repair addendum, where the seller agreed to make certain repairs based on the home inspection, you’ll need this addendum if you find issues with the repairs down the road.
4. Seller disclosures
Sellers are required by law to disclose certain problems with the home, both present and past, that they’re aware of that could affect its value. While laws vary by state, these disclosures might include lead-based paint, pest infestations, and renovations done without a permit.
Why you should keep them: If major problems crop up with your home after you move in, these disclosures can be the basis for a future lawsuit against the seller. If you lose them, you might have trouble holding the seller accountable in a court of law.
5. Home inspection reports
After your home inspection, your inspector should produce a report with detailed notes on the condition of the home and any potential problems.
When you buy a home in Glendale CA we also recommend a chimney scope, a sewer scope and a termite inspection. It is a good idea to keep all of these reports, as well.
Why you should keep it: These documents are an extremely detailed list of everything that the inspectors find, and they typically includes photos (or video) of problem areas. By keeping this report, you’ll have a record of any repairs that you may need to make to the property in the future.
6. Closing disclosure
Mortgage lenders must provide borrowers with a closing disclosure (also called a CD) at least three business days before settlement. This document spells out things such as your loan term (typically 15 or 30 years), loan type (a fixed-rate or adjustable-rate mortgage), the interest rate, and closing costs, among other financials.
Why you should keep it: Your CD is an itemized list of all the costs associated with closing and your mortgage, and it’s important to have for future reference. It’s also the document you’ll need when you go to file your taxes, since you can take deductions for things such as mortgage points.
7. Title insurance policy
Title insurance offers protection against any competing claims to a home. As part of the process, the insurer will run a title search of public records, seeking loose ends such as liens against the property or fraudulent signatures on ownership documents.
Why you should keep it: You’ll need this document in the event another party, such as a previous owner, tries to claim the property. Note that there is separate title insurance to cover lenders versus buyers, and you would do well to get a policy for yourself.
Are you ready to find out which document surprised me?
8. Property deed
When you take title and become the sole owner of the property, you’ll receive a deed—a legal document that confirms or conveys the ownership rights to the home, says Anne Rizzo, associate vice president of Detroit-based title insurance company Amrock.
“It must be a physical document signed by both the buyer and the seller,” Rizzo says.
Typically, the property deed is mailed to you after the title transfer documents are recorded in your county’s public records office.
Why you should keep it: Presenting a property deed is the only way to show someone you legally own the home you’re residing in. Because the deed is sent to you directly, neither your mortgage lender nor title company is required to keep a copy of it.
I thought the bit of paper that said “Deed” was like a commemorative plaque– the real deal was recorded at the county recorder’s office and your title insurance policy was the guarantee that this was so. In my over 30 years of selling homes I’ve had only ONE homeowner produce that deed for me. I’ll bet few reading this article know where their deed is located.
I did a bit of research. 99.999% of the time that bit of paper is unnecessary. The recording and the title insurance are all that are necessary to prove ownership of a home. HOWEVER, it is possible that a deed might require a correction- and the actual document is the easiest way to make it happen. It isn’t impossible to prove ownership without the deed- it’s just way easier.
Again- if you bought with DIGGS we’ve got your back… and your deed.