Understanding the Contract | PART 1 | What conveys?

Understanding the Contract | PART 1 | What conveys?

Hey El Paso, my name is John Peña with Peña El Paso Realty Group. If you are looking to buy or sell a home, please consider reaching out to us and we want to do you the solid. Essentially, if over the next couple of episodes we're going to kind of walk you through the nitty-gritty of the 1 to 4 family

residential contract. This is the contract that you have to use if you are purchasing or selling a resale home. This is a contract that you're going to see. And so, you know, a lot of times real estate agencies either don't take the time to explain it or they don't understand it well enough themselves to

explain it. But you, whether you're buying or selling a home, it's going to it's going to be in your best interest to definitely understand the main points of this contract. And that's what we're going to give you over the next couple of episodes. So let's jump right in. So paragraph 1. Okay, this basically is

pretty simple. This lays out who the parties to the transaction are. We need the names of the seller and we need the names of the buyers. Okay, this might be one person, it might be a married couple, whatever it is. This is where we're going to declare, okay, these are the sellers, these are the buyers, and this is

going to be a legally binding contract if accepted between these two parties. That one's easy enough. Number 2, though, is pretty interesting. This gets into some areas where there are some misconceptions. So we want to break this down for you. I'm going to put this up on the screen. Number 2, paragraph 2,

basically describes the property, okay, including the land, the improvements, and the accessories. Okay, all of those are collectively referred to as the property. Okay, we're going to get into that in a second. Section A there is just kind of a lot block subdivision description. We'll take care of all of that. This is where

though, paragraph B, is where we get into some interesting situations. This is what we call improvements. What are the improvements of the home? A lot of times people purchase a home or sell a home and they think that they're going to get a certain aspect of the home is going to convey, let's say, the TV mounts on the

wall. Or a seller is selling a home and they are like, no, I'm taking those TV mounts. This is where we can have problems. So it's really important to understand what improvements are. So let me give this to you, all right. Now, the house, the garage, and all other fixtures and improvements attached to the above

described real estate property, including without limitation, the following permanently installed and built-in items. This is very, very important, okay. If any, all equipment and appliances, okay. Appliances we're going to talk about a little bit later. There's some exceptions. Valances, screens, shutters, awnings. We're

talking about window treatments. Wall-to-wall carpeting, right. Mirrors, ceiling fans, attic fans, mailboxes, television antennas, mounts, and brackets for televisions and speakers. Heating and air conditioning units, of course. Security, this is a big one, and fire detection equipment. Wiring, of course.

Plumbing, lighting fixtures, chandeliers, water softener system, kitchen equipment, garage door openers, cleaning equipment, shrubbery, landscaping, outdoor cooking equipment, and all other property attached to the described real property. Now, this is important because if a, if a buyer purchases a home, they are, if

their real estate agent has counseled them correctly, they are under the impression that all of those things I just mentioned are going to convey with the home. The general rule is, if it's attached to the home, like a TV antenna on the roof, the HVAC system, the plantation shutters, if it's attached

physically to the home, TV mounts, speaker brackets, it stays. It conveys. That means if you're a home owner, and you sell your home, and you remove any of those items, you are potentially legally breaching this contract, and you are putting your sale, yourself, in an unfavorable situation, a buyer could come after you

and say, hey, wait a second, where, where's the, where's the, the garage door opener? Now, I know no one's going to take garage door opener, I would hope, but hopefully you get my point. So, this is very, very important to understand exactly what's going to come with the home, and what the seller can take, free

and clear, with the home. Obviously, the seller is going to take all of their personal belongings, but if you think about it, your personal belongings typically aren't attached to the home, right? Your furniture, your beds, your, your, your, your dressers, all of your stuff that you have in your bathroom, your

grooming stuff, like, of course, all of that's going to go. But, like I said, things that are attached, very, very important. You cannot imagine how many people have expected to, a buyer has expected to walk into their new home when they close, and see that beautiful chandelier hanging in the living room, but all of a sudden, the

seller took it, and guess what? There's a big problem. So, it's very, very important to understand what's going to, to convey with the home, and what is not. And so, just so that we can wrap up this section, if we look at Section C, Accessories, okay? Let's talk about accessories. The following described related accessories,

if any, window air conditioning units, stove, fireplace screens, curtains and rods, blinds, window shades, draperies and rods, door keys, mailbox keys, above-ground pool, swimming pool equipment, maintenance accessories, artificial fireplace logs, security systems that are not fixtures, and controls for garage doors, entry gates, other improvements

and accessories. Controls include, okay, sellers transferable rights to the software and application used to access and control improvements or accessories, and hardware used solely to control improvements or accessories. This gets into primarily security systems, because nowadays so many of us have, whether it's Ring or some other type of service, but doorbell locks

and cameras, motion detector cameras, that when somebody goes, you know, in your backyard and you've got the Ring camera, it shows up on your phone and you get an alert. All of those types of items, if not stated in the exclusions, which I'm going to talk about here in a second if you're a homeowner, but all of those items are expected to stay with

the home, right? If you think about it, the Ring doorbell, it's physically attached to the home, right? The Ring camera is physically mounted to the home. It's physically attached, right? Any controls that go along with that, software, things like that, security systems can be a real tricky one, because a lot of times people, when they're selling their home,

they're just like, oh, I'm going to, yeah, of course, I'm going to just, you know, when I sell the home and move, I'm going to take all my little cameras and then I'm going to put them on my new house, wherever I move. But unless you state exclusively that you're going to actually do that, you cannot do that. And again, you're putting yourself in a bit

of a pickle if you take those items and then the buyer shows up to their new home and all of a sudden those items are gone. This is where unfortunately we see, you know, lawsuits and things can get ugly. So it's super, super important to know this. I know it's not the most interesting topic in the world, but if you're buying or selling a home, it's super

important and let's finish up with this. So now we're still in paragraph two where we're talking about everything that is going to convey or stay with the property and everything that isn't. So paragraph D is exclusions. Very important if you're a home owner, if you're selling your property, it says the following improvements and accessories, all

of those items I mentioned in the last two sections will be retained by the seller and must be removed prior to delivery of possession. Now, if you're a homeowner and you are, you are, you know, if that chandelier in the living room that we talked about is a family heirloom, you want to take it, no problem, but you need to include that in the listing so that the

buyer knows that they need to include that on the contract. And if they don't include it on the contract, your real estate agent needs to put it into the contract so that it's very explicitly stated on the contract that that chandelier or those, that security system that you're going to take that with you. You're going to remove that from the

home and take it with you. So, so important. And then one more here. Okay. Reservations, any reservation for oil, gas, or other minerals, water, timber, or other interest is made in accordance in accordance with an attached addendum. What this is talking about are things like mineral rights and things like that. And honestly, in El Paso, you as a homeowner,

you don't have any claim to mineral rights. That's just the way that El Paso is. And so this one really doesn't matter if this were maybe like a farm or a land, then it might come into play. But for single family homes, this one's not going to matter. So that is just kind of the first little part of the contract. And you can see just on that first

page and the, you know, paragraph two, right away, we're coming up on some really important aspects about if you're buying a home, what you can expect is going to come with the home. And if you're selling a home, what you need to know that's going to stay with a home, or if you want to take something special that's attached to the home that you now, you know,

all right, I need to let my real estate agent know, Hey, this is an exception. I'm taking not going to convey. So hope that is helpful to you over the next couple of weeks. Like I said, we're going to walk you through the contract just so you totally understand everything about it. Of course, if you have any questions, by all means, reach out to us and we'll see you

in the next episode.