An important component of most real estate transactions is the negotiation of seller’s representations and warranties with respect to the property. This is to disclose information to the buyer that only the seller knows or to which only the seller has access. More specifically, a forum for the seller to disclose or highlight known risks, such as pending litigation, tenant defaults, known defects etc.
Here is an example of seller warranties:
a. Seller is the owner of the Property and has good and marketable title thereto, and the absolute rights to sell, assign and transfer the same to Purchaser free and clear of all debts, liens, mortgages, pledges, and encumbrances of any kind. Seller shall convey the Property to Purchaser by general warranty deed and without any title objections.
b. To the best of Seller’s actual knowledge, there are no actions, suits, or proceedings at law or in equity pending, threatened against, or affecting the Property or Seller.
c. To the best of Seller’s actual knowledge, no toxic or hazardous materials (as said terms are defined in any applicable federal or state laws) have been used, discharged or stored on or about the Property, and to the best of Seller’s actual knowledge, no such toxic or hazardous materials will at closing be located on or below the surface of the Property.
d. The seller has not, nor to the best of Seller’s knowledge or belief has any predecessor in title, executed or caused to be executed any document with or for the benefit of any governmental authority restricting the development, use or occupancy of the property that has not specifically been disclosed to Purchaser or would not be revealed by a title report.
e. Seller is not aware of any structural deficiencies with any buildings on the Property. All plumbing, electrical and HVAC systems shall be in working order at closing.
The information provided in this video does not, and is not intended to, constitute legal advice; instead, all information and content here is for general informational purposes only.