1. Contracts: Read your contract. If working with a Realtor
or developer's sales agent, ask him or her to give you a sample
contract to read ahead of time before you submit an offer. When
you have found a property you want to bid on and the Realtor or
sales agent prepares the contract, make sure you read all the filled
in blanks. Is all the personal property (refrigerator, window covering,
etc.) you want included in the contract? Is the closing date acceptable
to you? If the date of possession is after closing, are you OK with
the extended date? Does the mortgage contingency accurately reflect
the loan terms you are seeking?
2. Attorney approval: Always make sure your contract contains
an attorney approval provision with a minimum of five business
days. If you are working with a Realtor, have him or her insert
it. If you are working with a developer's sales agent, have them
point it out to you as well. Often developer's contracts do not
contain an attorney approval clause.
3. Inspections: If you are buying from an individual as opposed
to a developer, also make sure the contract contains an inspection
provision with a minimum of five business days to conduct
an inspection. As soon as the contract is accepted by the seller,
schedule your inspection. Use a professional inspector suggested
by your Realtor, attorney or friends. You may have an uncle that
knows a lot about property and if so, have him come along on the
inspection but use a professional.
4. Mortgages: Use a reputable loan officer on a personal
recommendation. Don't be fooled by unusually low rates. If it's
too good to be true, chances are the loan officer will not deliver.
Unfortunately, you often find the loan officer cannot deliver your
loan or has changed the terms when it is too late to shop elsewhere.
5. Pre-closing: Whether you have a Realtor or not, always
conduct a pre-closing walk through to ensure the property is in
the same condition as the date you signed the contract, normal wear
and tear excepted. Most standard Chicago real estate contracts contain
a provision that says all mechanical, electrical, plumbing and appliances
will be in working order at the time of closing. If you are buying
new construction or rehabbed property, take a professional inspector
and compile a list of incomplete items. This is called a punchlist.
6. Closing: The closing usually takes 1 ½ to 2 hours. You
will need to bring the following: a certified or cashier's check,
payable to you, insurance if you are buying anything other than
a condominium and whatever other last minute documents your loan
officer instructs you to bring. At the closing your attorney will
explain the loan documents and seller's documents to you.
When Selling:
1. Preparation: Always call a Realtor at least two months
before you intend to list the property. He or she will have suggestions
on the preparation of your home for sale. Schedule an appointment
with at least two Realtors and compare their presentation, their
suggested sale price and their plans for marketing your property.
Ideally they should present you with comparative market analysis
(CMA) showing what similar properties in your area have sold for
in the last six months.
If you are selling multi-unit property and are unsure if all of
your apartments are legal, obtain a zoning certification from the
City of Chicago Department of Zoning. The City will certify how
many legal units are on the premises. If the number the Department
of Zoning certifies does not match the number of units in your building,
call your attorney before listing your property.
2. Listing agreement: Your Realtor will present you with
a listing agreement which you should have an attorney review before
signing. Under many listing agreements you can end up owing the
Realtor a commission if you enter into a contract for sale and for
some reason the transaction does not close. Realtors will generally
charge a commission of between 5 and 7% to sell your property. This
is negotiable but remember, if the commission is unusually low,
other Realtors will bypass your property to show their clients properties
which pay them a higher commission. Don't negotiate to your own
detriment.
3. Contact: Read your contract. Make sure all the personal
property (refrigerator, window coverings,etc.) are agreeable to
you. Are there any items you want to specifically exclude such as
a particular light fixture or hanging pot rack? If so, make sure
it's in the contract. Check the closing date and possession date.
Are you giving possession at closing and if so, will this give you
enough time to move on the same day? If you need extra time in your
home after closing, make sure you negotiate it in the early stages
of the contract.
4. Closing: Your attorney will prepare all documents necessary
for your transaction. You do not need to appear at your sale closing
if you don't want to. You can pre-sign closing documents and have
your attorney handle it all. At the sale closing, your buyer will
sign his or her loan documents and examine the documents your attorney
has prepared. Your sale proceeds will then be wired to your account,
delivered to you via overnight service or brought to your purchase
closing if you are buying immediately thereafter.
