Buying a home in the United States is an important financial strategy for many new immigrants for overseas property investment and global asset allocation. What issues should new immigrants pay attention to when buying a home in the U.S.? Worldway Group will launch a series of comprehensive guides on buying property in the U.S. for new immigrants to serve as a reference for our new immigrant friends.
Signing the purchase agreement is the final and most critical step in the home-buying process. So, what exactly should you pay attention to when signing a purchase agreement? In this issue, we will introduce the final stage of the U.S. home-buying guide for new immigrants—signing the purchase agreement.
In the United States, the housing transaction market system is very sound, which is reflected in U.S. real estate purchase contracts. When signing a purchase agreement, you must carefully review and confirm each clause one by one. A detailed contract with clear rights, responsibilities, and procedures is the guarantee for a smooth home purchase.
The following is an explanation of the residential purchase agreement in California, USA. It involves more than thirty steps, each of which is very important. The most critical contents are as follows:
1、Grasp the timeline; verbal promises are not binding, and all contract changes must be in writing
It should be noted that in any part of the home-buying process, verbal promises made by the buyer and seller during negotiations are generally not legally protected unless these verbal promises are written and listed in the contract.
2、The buyer's payment method
Different payment methods lead to different transaction processes. The contract must explain how the buyer will pay. Most buyers pay a "deposit" in advance. An "Escrow Holder" refers to a neutral company that is not influenced by the buyer or seller, and they will hold the deposit for the buyer. In this section, the buyer can also indicate whether a loan is needed (if a loan is needed, how much the amount is); or whether the buyer will use other existing funds to purchase the house.
3、Completion of sale and handover
The third section explains when the buyer will move into the house and when the seller should move out. If there are still tenants living there, it is necessary to specify how the existing tenants will be handled, and you can also specify when the buyer can obtain the keys in this section.
4、Cost sharing and payment
The contract should specify who, the buyer or the seller, will pay for the transaction fees. For example: reports on the surrounding environment of the property (whether the house is located in an area prone to earthquakes, fires, and floods), title insurance fees, escrow company fees, property taxes, or other government fees.
5、Statutory disclosures (including lead-based paint notification) and the right to cancel the contract
The contract should specify the items that the law requires the seller to inform the buyer in writing. For example: whether the house's paint contains lead, whether the house is in an earthquake zone or an area prone to fires and floods, and any problems with the house known to the seller. Generally speaking, if the buyer does not like any of the disclosures, the buyer has several days to consider canceling the contract and getting the full deposit back.
6、Common Interest Development/Condominium disclosure
The contract should point out that when a house is subject to certain regulations, the seller must provide the buyer with additional information. For example: if the house is a condominium or has other established covenants regarding shared facilities such as swimming pools or meeting rooms.
7、Conditions affecting the property
The contract should state that at the time of handover, the house should be in the same condition as it was when the buyer signed the contract. The seller does not need to repair anything that is already damaged. However, the seller must tell the buyer about any damage known to the seller and is responsible for repairing any parts damaged after both parties have signed the contract. This section also reminds the buyer that the buyer has the right to "inspect" the property to be purchased. If there is any dissatisfaction after the inspection, the buyer can cancel the contract, or he or she can request the seller to make repairs. Although the seller does not have to fix all problems, if the seller refuses to repair after the buyer makes a request, the buyer has the right to cancel the contract and get the deposit back.
8、Repairs
The contract should state that if the seller agrees to be responsible for repairs, they must be completed before the handover, and the buyer also has the opportunity to inspect before the handover whether the repairs are satisfactory to the buyer. Regarding buyer compensation for property damage and seller protection, the contract should state that the buyer promises to compensate the seller for losses if the buyer or the inspector hired by the buyer damages the property.
9、Title and ownership
The contract should explain some reports that protect the seller's interests. For example: if the seller does not own the full title, or if others have the right to use part of the property (such as telephone or gas companies or neighbors); this can also protect against certain ambiguous situations, such as property where actual boundaries are unchecked or difficult to confirm. Please remember that fences and natural boundaries, such as trees or shrubs, are not necessarily planted on the boundary line.
10、Maximum loss if the buyer fails to perform
The contract should state that if the buyer cancels the contract without sufficient reason, the seller can sue the buyer for damages. If the buyer signs before this text, then if the buyer cancels the contract for no reason, although the seller can still sue the buyer, generally speaking, the maximum amount the buyer loses is the deposit paid.
11、Dispute resolution
The seventeenth section has multiple functions. This is the basis for the buyer and seller to agree to mediate any disputes or claims, a way for both parties to resolve differences, and helps both parties solve problems that real estate agents cannot solve. If the buyer and seller sign below this section, it means that if the dispute cannot be resolved, both parties agree not to go to court but choose to have an "arbitrator" resolve it. An arbitrator is not a judge, but has the authority to decide who is right and who is wrong between the buyer and seller and other matters, including financial disputes between the two parties. In this section, the buyer also agrees to resolve disputes with the agent during the transaction process through arbitration.
12、Proration of property taxes and other expenses
The buyer and seller agree that certain expenses and periodic expenditures will be prorated if the real estate transaction is completed before the periodic payment deadline.
Worldway Group's U.S. immigration experts analyze that the U.S. economy is recovering strongly and has once again become the locomotive leading the world economy. With the U.S. dollar exchange rate about to enter a fast upward channel, converting RMB assets into U.S. dollar assets is undoubtedly a very good way of asset allocation. In 2015, U.S. investment immigration will face many complex situations such as visa backlogs, investment amount increases, and the expiration of the Regional Center Program. At this time, the strong recovery of the U.S. economy highlights that the current stage can be called the golden application period for U.S. EB-5 investment immigration. For investors who intend to immigrate to the United States, choosing this time period to apply for U.S. EB-5 investment immigration can not only actively respond to immigration backlogs and avoid uncertain factors such as investment amount increases and the expiration of the Regional Center Program, but also take advantage of the opportunity for overseas asset allocation.
The Pennsylvania Turnpike project, exclusively represented by Worldway Group and pre-approved by the U.S. Citizenship and Immigration Services, is a 100% U.S. government EB-5 project with loans from the state government and repayment guaranteed by the state government. The first phase was snapped up in just two months. Currently, the second phase of the Pennsylvania Turnpike project has seen an even more enthusiastic buying situation than the first phase. On March 21 and 22, Worldway Group will hold official briefing sessions for the Pennsylvania Turnpike project in Shanghai, Shenzhen, Qingdao, and other places. Executives from the DVRC Regional Center and the Pennsylvania Turnpike Commission will be present in person. Registration is currently hot, and the reservation hotline is 400-138-2929.
Shenzhen
Time: Sunday, March 22, 2015, 14:30-17:00
Location: Lily & Lotus Room, 29th Floor, Four Seasons Hotel Shenzhen (No. 138 Fuhua 3rd Road, Futian District, Shenzhen)
Special Guests: Mr. Richard C. Dreher, Deputy Chief Financial Officer of the Pennsylvania Turnpike Commission, and Mr. Young Min Ban, Director of the DVRC Regional Center
Qingdao
Time: Sunday, March 22, 2015, 14:00 PM
Location: Meeting Room 2#, 5th Floor, The Westin Qingdao (No. 8 Hong Kong Middle Road, Shinan District, Qingdao)
Special Guests: Mr. Timothy J. Carson, former Vice Chairman of the Pennsylvania Turnpike Commission, and Mr. Joseph P. Manheim, President of the DVRC Regional Center
