Guidelines For Including Personal Items In Purchase And Sales Agreements

In the home buying process, it is typical to request appliances. Occasionally, people might try and get other personal items as well, such as window coverings or equipment. Prior to including such things in purchase and sales agreements, it is important to know the affect that it might have on the mortgage underwriting process. This blog covers the topic of guidelines for including personal items in purchase and sales agreements.

Appraisal Issues

When including personal items in purchase and sales agreements, buyers may be willing to offer more for the real estate considering the cost of the items. However, lenders and appraisers will not attribute any value for them. This is justifiable because lenders are loaning money according to the value of "real" property. Should a borrower be unable to make payments, the lender will initiate the steps for foreclosing on that property. Lenders can not foreclose on items such as electronics, so those will not add value to a property from a lender's viewpoint. If a home buyer inflates the offer dollar amount to include personal items, it is possible that the appraisal will not exceed the offer price. Furthermore, some underwriters may not like such items being included in purchase and sales agreements.

Solutions for Addressing Personal Items

Personal items may be noted in various ways. Insignificant items can be written into purchase and sales agreements as gifts from the seller. For large ticket things, or a large number of items, it may be advisable to list it on a separate contract. The Seller would basically be agreeing to convey the personal items for a particular dollar amount to the Buyer when the property transfers ownership. The cost and other details would not be entered in the actual purchase and sales agreements and the real estate transaction would therefore not be contingent upon the sale of these personal items.

Guidelines For Including Personal Items In Purchase And Sales Agreements

Home buyers may certainly purchase certain personal items from a seller of a home, but how that is handled will differ depending on the particular items. Always consult with your real estate representative and loan officer ahead of time to figure out the best solution. This will reduce delays in the appraisal process. This information on "Guidelines for including personal items in purchase and sales agreements" was published by Scott Beard at Bean Group.

About Scott Beard

Finding the right Realtor can be the difference between a happy, stress-free home buying or selling experience, and an unhappy, stressful experience. That’s why choosing the right Agent to begin with is key. I have helped hundreds upon hundreds of clients during my career and sold over $55 million in properties and look forward to putting my experience to work for you.
Contact me at any time. I look forward to hearing from you.

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