The Legal Checklist to Selling Your Home

The Legal Checklist to Selling Your Home


When all is said and done, selling your home is basically a business transactions. That means, the law is going to get involved, and there are a few legal things you need to know before you start posting your home to listing sites.

If you’re considering selling your home, read through our legal checklist and make sure you have all your documents and finances ready to go before the offers start coming in.

Review Encumbrances, Debts and Liens

All encumbrances, debts and liens must be dealt with before your home may be sold. The earlier you take care of this, the better. Buyers may back out of deals if they know you have to settle a few financial issues with your home, which may take a while.

Some of these issues include:

  • Any local, state or federal tax liens
  • A judgment from a civil court
  • Any missed spousal or child support payments
  • Other unpaid debts
  • Overdue homeowners association fees

No matter what happens, these bills must be paid before you can move forward with a home selling deal.

In the event that you must deal with a large civil judgment or a huge tax lien, then selling your home won’t make these issues magically disappear. These issues will come up when the buyer searches the title, and their overall costs will come out of the sale of the home.

Figure Out Tenants

If you inherited your home along with a few others, then you need to figure out exactly who owns the home. If you don’t then you will have to go through the state’s court of equity to figure out exactly who owns how much of the home. This is a lengthy and expensive process, but it will need to be done before the house can be sold. Everyone will need to be on the same page with it comes time for selling your home.

Divorce proceedings are a similar case. If you and your ex-spouse own the home together, then it will be up to both of you to settle how the home should be sold. Whatever you do, don’t try to cheat your spouse out of the home’s proceeds. You will run into legal problems, and it could cause the sale to collapse altogether.

No matter how angry you are with an ex-spouse, sell the home together and be fair and upfront. The process will be much less painful and long.

Work Out Additional Problems

Let’s say you and your partner (not married) bought the house together and moved in, but your partner isn’t on the title deed. Your partner put in money, but for whatever reason, he or she was left off the title deed. This happens often in the U.S., but it is possible to work with  your partner to make sure he or she gets the proceeds owed.

The best thing to do is to have open and honest communication throughout. Sit down with the partner and a realtor to determine who pays what of the lasting mortgage payments as well as what the asking price of the home should be and what is the minimal you’ll both accept for the home.

You should also decide who owns the home and how much. If your partner put in half for the home, then it’s 50/50.

As soon as you finish, draft a home sale document and get everything signed. This will make the buying process easier later on.

Get All Necessary Documents

Selling your home will go much smoother if you have:

  • The deed to your home
  • Any evidence of judgments, liens or encumbrances
  • All appraisals and surveys
  • Full documentation of any major home renovations or repairs
  • Legal agreements made by partners or co-tenants
Top