The list of items to worry about during the real-estate closing process can seem endless. There are lawyers to be consulted, documents to be gathered and signed, possible moving arrangements to be made, and the list goes on and on.
Perhaps one of the most important considerations during the real-estate closing process is the determination of what items to include or exclude in the final contract. While this might seem like common sense, or even redundant, the ramifications of not giving this consideration the attention it deserves can be considerable.
A real-life example
To provide a real-life example, a homeowner that was in the process of closing a real-estate sale tried to cancel a three-year contract with a provider of a home security/alarm system. There were still many months remaining on the contract. According to the security provider, the contract could only be cancelled upon paying a significant penalty. Alternatively, the service could be used for the remaining three years of the contract.
Since the homeowner couldn’t do anything about the contract itself, what then remained to be determined is its status upon selling the home — which is where the issue of chattels come in. In real-estate, a chattel is any property or asset that the seller can legally take with them.
So, for example, a stand-up dishwasher can be considered chattel. Similarly, a contract with a home security service can be considered chattel, too. In other words, it’s an obligation that can be passed off from buyer to seller, too. Perhaps most importantly from the perspective of real-estate law, it’s an obligation that can be included or excluded in the final closing contract.
Terms of the contract
In the case mentioned, the real-estate seller included the security service contract in the terms of the final sale, so that it would become the responsibility of the real-estate buyer to then deal with the security company, and make any necessary payments.
This kind of chattel isn’t solely exclusive to home security contracts, either. Similar types of real-estate chattel include furnace leases and water-heater rentals. As with all matters related to a real-estate closing, the final terms of the contract should be closely scrutinized, especially by a qualified and trusted real-estate lawyer.
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