Assuming the Seller has no outstanding loans on the Property being sold (Deeds of Trust, HELOCS, Equity Lines), the Purchaser’s title company, while doing the title search, will find there is no mortgage on the property. The title company will accordingly request that the Seller sign a “No Financing Affidavit” to confirm that there is no loan on the property. In this situation, to make the closing smoother and to protect the Purchaser’s interest, consider inserting the following into paragraph 31 of the VAR Contract:
“Seller is required, if applicable, to sign a No Financing Affidavit for the Purchaser’s title insurance Company.”
The failure to sign the No Financing Affidavit could create additional work and/or delay for the Purchaser. Inserting this sentence in the contract during execution, when all parties are eager to make a deal, could save hassle later on for the Purchaser.
In the same vein of making the closing process smoother, please also consider inserting the following into Paragraph 31:
“The Seller agrees to provide to the Purchaser, if available, copies of any physical surveys and/or owners title insurance policies or binders. In addition, if accurate, the Seller agrees to sign a survey affidavit stating that the prior physical survey is still accurate.”
Again providing these documents to the Purchaser can actually save money, time and possible future problems.
William (Bill) D. Tucker, III
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