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06.20.17   |   Insights

Interested in Buying a Home? Things to Consider Before Signing the Purchase Contract

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Ohio has enjoyed a short-period of strong real estate sales.  Many believe the trend will continue, despite the anticipated interest rate hikes and delayed participation in home ownership by millennials.

Because of the strong real estate market, many deals are put together very quickly.  Whether you are working with your attorney, or with your realtor to negotiate a transaction, there are several contract provisions which may deserve a closer look before you sign on the dotted line.

The non-exhaustive list below includes a quick explanation of several contract provisions which you should consider with your realtor and attorney prior to entering into a real estate purchase contract.


In different regions of Ohio, closing fees are split or allocated to the seller or buyer.  The term “closing fees” takes on many different meanings to many different people.  To a closing agent that prepares the final settlement statement, the term “closing fees” includes:

  • Auditor’s conveyance fee (tax on the sale by the County Auditor);
  • Cost of preparing deed;
  • Cost of title insurance and related costs such as the title search;
  • County Recorder fees for filing transfer documents;
  • Cost of title agent to close the transaction;
  • Other government fees;
  • Cost of obtaining a loan; and
  • Other costs based upon a particular transaction.

The buyer and seller should clearly allocate these costs in the real estate purchase contract.  Your attorney and your realtor can assist with what is customary in your area.  Also, keep in mind that while there is a custom in the area, which party pays the costs is negotiable between the parties.


Title insurance usually takes 2 forms: (1) an Owner’s policy provided to the buyer, and (2) a loan policy provided to the lender.  Commercial lenders will not loan money on a transaction, unless a loan policy is provided.  Title insurance rates, regardless of where you close in Ohio, are set by the State of Ohio.  Typically a Buyer will pay for the costs associated with obtaining a simultaneous issue loan policy, unless otherwise negotiated in a purchase contract. 

To issue a title insurance policy, a thorough title search is performed on your property to ascertain the liens, encumbrances, taxes, leases, and other matters which affect the title which is summarized in a title commitment prior to closing.  Heartland Title Agency, LLC is an agent for First American Title Insurance Company which provides title insurance to owners and lenders to protect each from potential defects that can arise despite a thorough search of the public records.  Title insurance policies protect the insureds from potential defects which include forged deeds, forged mortgages, forged mortgage releases, undisclosed state/federal tax liens, varying probate errors and other deed defects.  It is highly recommended to obtain an owner’s policy of title insurance on all transactions.

Speak to your attorney or your realtor about what the custom is for paying for title insurance costs in your area. 


Once you own the home, you own the problems and costs associated with maintaining your investment.  Many people refer to this as the “joys of home ownership.”  Many buyers are unwilling to take the risk of buying a home in its “as-is” present condition, and many lenders require inspections prior to lending funds.  A home inspection is your chance to ascertain the condition of the home prior to taking title.  Inspections may include electrical wiring, plumbing, and structural features of the home.  If there are objections to the condition of the home, buyers can demand that the problems be fixed prior to closing.  Once you have received the deed to your home, it is often too late to fix problems which could have been addressed prior to closing.


In transactions with a lender, often times the lender will require a “location survey” to verify that the improvements on the property do not violate any setbacks or public right-of-ways.  A location survey is prepared by a registered surveyor who maps out the improvements (home, garage, driveway etc.) on the property and shows whether they encroach onto setbacks or a neighboring property.   Depending on the severity of the encroachment, an improvement may need to be removed, an easement may need to be obtained, or insurance may be provided over the violation, subject to the underwriter’s approval.

In cash transactions without a lender, it may be beneficial for the buyer to obtain a location survey to prevent future impediments or surprises when you ultimately sell the property in the future, depending on the type of property being purchased.  As is the case with pre-closing inspections, if you do not have a location survey done before purchasing the property, you are stuck with the encroachments that come along with owning the property, which may come at a significant cost to you.  Consult with your attorney regarding the necessity of obtaining a location survey.


It is recommended that parties to real estate purchase contracts seek the advice of an attorney prior to entering into an agreement with a buyer or seller.  If you wait until after you sign the contract to seek the advice of an attorney, it may be too late to correct a provision at the request of your attorney.  Many realtor form contracts contain a provision for attorney approval of the contract, but they often include the ability for the buyer or seller to provide the reason why the contract is disapproved and a proposed remedy to fix the issue.  If you fail to seek attorney approval of the contract, parties may be taking on additional or unanticipated risk.

CCJ has highly qualified real estate attorneys in all locations ready to assist you when entering into a real estate purchase contract.

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