melissa thompson and your key to memphis home buyer handbook

THE SECRETS TO BUYING A HOME THAT MOST AGENTS DON'T TELL YOU

What happens when you team up with a knowledgeable, caring Realtor to find your dream home?

6525 N Quail Hollow Road Memphis TN 38120tel: 901.756.8900

direct: 901.230.2610fax: 901.435.0620

www.yourkeytomemphis.com

THAT DREAMBECOMES AREALITY!

Are you tired of making someone else’s mortgage payment?

Will you go another year with little or no tax write-offs?

Did you know there are over 50 ways you can buy a home?

Would you like to build equity in your financial future?

Why should I work with a REALTOR®?

YOU NEED TO KNOW THE FACTS!

to find out the facts about owning a home andhow it will become a reality, not just a dream!

CONTINUE READING

THINKING OF BUYING A HOME?

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INTRODUCTION

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Do you have a steady, reliable income?In other words, have you been employed on a regular basis for the last two years and do you expect to maintain your employment?

In real estate, the motto is...

IF YOU SNOOZE, YOU LOSE!

The finer right-priced properties do not last!

When looking for a home, remember,

Tuesdays, Wednesdays, and Thursdays are best!

Weekends are worst! Most buyers look for

homes on the weekends. This is the time you will

most likely find yourself in multiple-offer situations competing with other buyers, and when you

compete, you’ll always pay more to get

the house.

GOLDEN NUGGET

Answer these four questions. If you answer yes toall of them, you are probably ready to buy a home.

Do you have a good record of payingyour bills?Have you made regular, on-time payments?If not, read on; there is still hope.

Do you have money saved up for a

Can you pay the mortgage each month?

down payment and closing costs?Many home buyers think that a down payment of 20 percent is needed. It’s not. Many loans exist today that allow buyers to put down 10 percent to as little as 3 percent on the purchase of a home. So don’t give up just because you can’t come up with a 20 percent down payment.

* Are you a veteran? Don't forget to ask us about VA loans!

As well as additional costs that go along with homeownership, such as taxes, insurance, and maintenance?

FIRST, ARE YOU READY TO BUY?

INTRODUCTION

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tel: 901.756.8900 | direct: 901.230.2610 | fax: 901.435.0620 | www.yourkeytomemphis.com

When you hire the Melissa Thompson Team, you get more than one agent who is trying to be all things to all

people. You will have a dedicated buyer specialist - (your own personal shopper!) - who will make sure you are

educated throughout the process. If your agent goes on vacation or is tied up elsewhere, fear not! We cover

each other so you will never feel neglected. Need utility information? Need to schedule the home inspector?

Our client care manager will dot every i and cross every t. We are ALL here working for YOU!

WELCOME TO THE TEAM!

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The purpose of this presentation is to provide the information you need to help you select the best person and company that will best represent you in buying your home. We hope after reviewing this material that you have a clearer understanding of how important you and your business are to us.

We appreciate the opportunity to show you our superior marketing and ultimate service. Please take the time to check the comments from some of our past clients in the sectioned titled “Our Clients Say It Best,” and find out why most of

the Melissa Thompson Team’s business comes from referrals. A referral is the highest compliment we can receive. We love referrals! That is why we perform outstanding, exceptional work during each and every transaction to earn them.

Working TOGETHER with you, we will achieve your goal and ours! We truly

appreciate the opportunity to interview for the position of your REALTOR®. We consider it an honor and take it very seriously. This is our career, not a part-time hobby! We will strive to serve you beyond your expectations.

We look forward to working with you!The Melissa Thompson Team

We don’t just say the word, service. We

live it and do it!

You chose to interview one of the best real estate service teams in the country. The Melissa ThompsonTeam is nationally recognized for the high-qualityservice that we offer our clients. You have the opportunity to experience that service. Our top-notch team has streamlined and systemized every detail of the home-buying and -selling process to make the entire experience enjoyable and stress-free for you. We handle everything with the utmost care and concern. We don’t just say the word, “service.” We live it and do it!

Melissa Thompson has put together a team of professional specialists who are backed up by the power of Crye-Leike. We go above and beyond the normal activities required to buy a property. Our goal is to satisfy clients’ wants and needs so well that they will be happy to refer other prospects to us. We work diligently and fervently to help you buy your new home at the best price in the shortest amount of time so that you can fulfill your vision and get on with your life. Of course, we require your total cooperation to accomplish that goal.

WELCOME TO THE TEAM

CONGRATULATIONS!You have made a wise decision!

5 tel: 901.756.8900 | direct: 901.230.2610 | fax: 901.435.0620 | www.yourkeytomemphis.com

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WELCOME TO THE TEAM

To help everyone I meet to love their existenceas much as I love mine.

To provide outstanding service and attentionthroughout the entire home-buying or selling process,

ensuring as smooth a transition as possible.

To devote myself to my fiduciary responsibilities ofloyalty, confidentiality, disclosure, and

accountability for all clients.

To utilize my knowledge of the area as a native.

To improve my professional advice by continuingeducation in all facets of the market.

To treat others not only as I would wish to be treated,but as they wish to be treated as well.

To be a faithful child of God by nurturing the talentsand blessings He has given me.

Melissa Thompson

MELISSA’SMISSION STATEMENT

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WELCOME TO THE TEAM

Why hire the Melissa Thompson Team?

Buying a new home can be more than just a financial decision. It can be an emotional one as well. That is why it is so important to choose the right real estate representative, one who is not a “salesperson” trying to sell you on something; but someone who wants to help you accomplish what you have decided you want to do. In order to do this successfully, your full-service real estate representative must be:

Your Property Specialist Your Transaction Coordinator Your Community Consultant Your Marketing Manager Your Experienced Negotiator Your Trusted Advisor and Consultant Your Real Estate Professional

The lone-agent concept just doesn’t get the job done in today’s marketplace. The MelissaThompson Team is dedicated to providing the best real estate service and advice. Working as a team, we easily provide full service to our clients. The team approach provides top-dollar valuefor the same price as a single agent.

We are not a “Jack of all trades, master of none.” We operate under the “Jack of one trade and he has mastered it well” philosophy. We use unity and strength to serve you. We strive to protect you and your home investment. We always watch out for your best interest. We work together to achieve one common goal: Your complete satisfaction!

The Melissa Thompson Team built this business on determining what people need and want and

finding the best way to give it to them.

THE ROLE OF YOUR BUYER AGENT


The Best Service...Better than 99% client satisfaction.

Results...We find the home perfectly suited to your needs.

Buyer Counseling...The most dedicated and experienced advisors to work with you.

Value-Added...Caring services from the entire team and our vendors.

Access...To ALL new and resale homes available.

Integrity...See our testimonials and client comments.

Ethical Standards...Assured by Melissa Thompson & Your Key to Memphis. We support and practice the professional standards of the National Association of REALTORS (NAR), the TN Association of REALTORS, as well as the local board of REALTORS.

Experience...Benefit from more than 1500 successful residential real estate transactions.

People who sell homes through us.People who buy homes through us.First... last... and always, people.

Client Service Philosophy“Just take care of the needs of people. Everything else will take care of itself. It is so simple.”

This difference in attitude is founded upon one basic idea. Our job is not to deal with brick,mortar and parcels of land, but with people.

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WELCOME TO THE TEAM

Our belief is

this

What You Can Expect From the Melissa Thompson Team

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REMEMBER: “We are here to help!”Always call the Melissa Thompson Team.

SHOP HERE FOR ALL OF YOUR REAL ESTATE NEEDS.

The Melissa Thompson Team takes care of everything for you.

Are you looking for a resale anywhere?

Is your preference new construction

anywhere, by any builder?

Did you see a yard sign somewhere?

Was the home you saw listed for sale

by another company or builder?

Was the sign a For Sale By Owner?

Did you see an ad in the paper, in a

magazine, or on TV? Was the ad on

a billboard, on a bus bench, or did you

hear it on the radio?

Did you find something that appealed

to you on the Internet?

Do you want to sell or buy in another

geographic area? It would be our pleasure to refer you to a reputable

REALTOR® anywhere in the U.S.A. to

either buy or sell a property. We have

built a very efficient national referral

network. Just ASK us!

One-Stop Home Shopping We offer you “One-Stop Home Shopping”. Simply tell us what you

want.

We can show you any property in the Memphis region

anywhere, anytime!

We can sell your current property too!

We cover all of the possibilities so that you can make the best choice.

You don’t have to play “phone tag”

with different REALTORS® or builders.

WELCOME TO THE TEAM


ESTABLISHINGCOMMON GOALS

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ESTABLISHING COMMON GOALS

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You will have a great tax write-off.

Your housing expense may never go up.

You can use, decorate, make physical

changes to, and enjoy your home as you

see fit.

You may increase your equity as your

home appreciates in value.

You are not at the mercy of your landlord.

Your house will become “home,” not a

temporary living situation.

Understanding the Advantages of Homeownership

You will have no tax write-off.

Your rent can go up each year, typically four to ten percent.

You must get permission from your landlord to make any changes to your dwelling.

You have no equity build-up. Your money is

gone for good.

You can be evicted, lose your security deposit, and more.

Your living situation is always temporary.

vs.Buying Renting

So let’s get started on the purchaseof your new home!



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The key to a successful home purchase.

Together, we will sit down to discuss the type, size, style, and location of the kind of home you are interested in purchasing. After extensive research on our part, we will preview homes together that fall into that category.

Through constant communication and the benefit of our newest technology, our instant HomeFinder Service, we will keep you appraised of any new homes that come on the market in which you might be interested. Once we have found that perfect home, we will negotiate with the sellers to get the best possible price and terms for the home you desire.

You will benefit from our years of experience in the real estate business at no cost to you. As you already know, our commission comes from the seller.

Communication...

Real Estate AdvisorProperty Information

Area Information

Financing Sources

Real Estate Skills (Negotiating Agreements, Settlements)

BuyerContributionProperty Requirements

Area Selection

Financial Information

Property Selection

SuccessfulPurchase


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Don’t Buy Your Home From SomeoneWho Won’t Guarantee Their Work!Historically, REALTORS® were not required to work with buyers under a formal buyer agency agreement. Most states now require that all real estate agents disclose agency in the form of a Consumer Notice. A real estate agent can work with a buyer in a variety of agency relationships.

Most agents do not educate their clients. We work with our buyers strictly in a Buyer Agency Relationship. What does this mean to you? This means we are working strictly for you, our buyer, in your best interest!

Our Pledge to Buyers: We feel so strongly about it, we put it in writing.

To provide unsurpassed service to help you buy your home at a fair market price,in the shortest time, with the least inconvenience to you, we will:

Explain real estate agency relationships.Maintain communication during the term of the agreement.Analyze your property needs and desires.Orient you to current market conditions.Provide helpful community data.Explain local real estate practices and procedures.Provide information on lenders and financing alternatives.Search the local Multiple Listing Service for suitable properties.Coordinate appointments and show all properties of interest, whether the properties are our listings or not.Provide relevant market data as to fair market value of homes.Disclose all material defects of the property that are known.Explain the offer-presentation process.Deliver State required Property Disclosure form.Carefully explain and prepare Offer to Purchase forms.Arrange to present all offers to seller in a timely manner.Strive to obtain the best possible price and terms for you.Explain post-purchase activities and responsibilities.Follow up on all post-purchase activities.Keep confidential any information that you designate in writing as confidential.


Buyer’s Guarantee: You’ll Love Your New Home!Purchasing a home is an important decision that affects your life in many ways.With such a large step, there is bound to be some level of hesitation.

If within 90 days of moving in, you don’t love your new home, we will get your home sold and completely waive our listing commission.

Guarantee period begins on date of recordation and ends on the same date, 90 days afterward.

The Waive Listing Commission does not include any closing costs or other seller’s expenses, including but not limited to a sales commission, if applicable.

It takes a strong belief in this kind of stand, but we won’t settle for less and neither should you. We guarantee that you will be happy with our service and your results. It’s not enough to simply make empty promises. Business professionals should have consequences for not keeping their promises and commitments. Business professionals should be held accountable for their performance. Our guarantee gives you the control you deserve.

Your Commitment to UsWe have explained in depth the advantages of working with the Melissa Thompson Teamas your exclusive buyer’s agent. In return we ask you:

To communicate responsibly and honestly.

To willingly provide pertinent information as needed.

To promptly inform the Melissa Thompson Team of changes in timing, requirements, or other critical information that will affect your service commitment.

To submit a loan application and all lender-required information within the time frames of the contract when obtaining financing.

To enter into contracts in good faith and make every effort to adhere to all negotiated contingencies.

To inform all other real estate agents that you are represented by the Melissa Thompson Team.

I agree to work solely with the Melissa Thompson Team for the next ______ days in a cooperative effort to locate and purchase a new home.

Signature ________________________________________________ Date ____________________


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THE A TO Z OFFINDING YOUR HOME

15tel: 901.756.8900 | direct: 901.230.2610 | fax: 901.435.0620 | www.yourkeytomemphis.com

THE HOME-BUYING PROCESSThe Melissa Thompson Team designed this book to assist you with the purchase of your home. We understand the many questions and concerns of home buyers and how this information will be helpful throughout the transaction. We assure you that it is our goal to provide the most professional and informative service available. Always call us whenever you have a question.We are here to help!

Consultation to Analyze Needs

Establish a Working Relationship

Get Pre-Approved by Lender

View New/Resale Homes withyour Dedicated Buyer Specialist

Select Home

Present Offer

Acceptance of Contract

Mortgage ApplicationUnderwriting

Loan Approval

Closing Attorney

Assemble Documents

Closing

Decide to Pay Cash

Escrow Deposit

Inspections Remove Contingencies

Credit Report Appraisal Verifications

Rejection or Conditions

Title Exam, Insurance, Survey

MOVING DAY!!

THE A TO Z OF FINDING YOUR HOME

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GET PRE-APPROVED BY A LENDERBeing pre-approved by a lender before you make an offer on a home can save you thousands of dollars later. When you call us to set up our counseling session, we can recommend a top lender for you to contact before our consultation.

YOUR CONSULTATIONWe will go over the basics of buying a home and provide you with the state’s Broker Disclosure Form. Next, we’ll ask you many important questions to help us get a clear picture of what your needs, wants, and desires are. This takes about 30 to 45 minutes.

CHOOSE YOUR SYSTEMAt your consultation, you’ll be asked to decide which system for finding a home you prefer.

The first is called Window Shopping. With this system, we provide you with all of the photos, addresses, and directions of those homes that match your criteria. This way you can drive by the homes before you tour them. Many people like this system because they get a feel for the home’s location and condition without having us present. When a home of interest is found, we are contacted for entrance into the home.

The second system is called Agent Previewing. This is a more traditional system for house hunting. We review all the homes that are available for you and will narrow the selection down to no more than seven “cream of the crop” properties, according to your criteria and our experience. On a pre-determined day, we will go out together to look at homes that have been selected.

At the end of our consultation, you sign a Buyer Agency Agreement, and the search is on!

FIND YOUR NEW HOMEOnce we know all your particulars, we use technology to search the Multiple Listing Service, as well as other resources, for properties that meet your needs. When we go out to see the selected homes, bring your checkbook! Don’t be surprised when you fall in love with a home your very first day, most people do!

THE STEP-BY-STEP HOME-BUYING PROCESS


1STEP

2STEP

3STEP

4STEP

Over 85% of our buyers buy their new homes after previewing six homes or less.


DRAFT YOUR PURCHASE AGREEMENTOnce we have found your dream home, we’ll go back to our office and complete a residential purchase agreement. A sample copy of this document is given to you at your consultation.

WRITE EARNEST MONEY CHECKAt this time, you also submit an earnest money check to go with your offer. This check is usually written for an amount equal to at least one percent of the price of the home. We take the check and the purchase agreement to the seller’s agent and negotiate the sale on your behalf. If the seller accepts your offer by signing the sales contract, you will have “mutual acceptance.”

PLEASE NOTE: When your contract is accepted by the seller, your earnest money check will be cashedand applied towards closing.

YOU BOUGHT YOUR NEW HOMEThis point is often the hardest part of the home-buying process. Why? Because buyer’s remorse may set in. Although a majority of our buyers are very excited, some still feel a bit of buyer’s remorse. This happens because it’s time for a decision, commitment, and legal documents. So remember, the butterflies you feel are normal. Rest assured, we haven’t lost one yet!

FORMALIZE YOUR FINANCINGNow that the paperwork is signed, complete a formal loan application if you haven’t already done so.Expect to pay for an appraisal and an extensive credit report. You’ll sign a Verification of Employment form. If you have asked for an inspection to be done on your new home, you may need to pay the inspector at the time of inspection.

PREPARE TO MOVEYour closing and possession dates will be determined when you write the offer to purchase and are agreed upon by both the buyer and seller. We work hard to make sure that everything runs smoothly and to make it as easy and pleasant for you as possible. We’ll coordinate your inspectors, appraisers, and lenders; identify problems; and find solutions.

Please feel free to call us at any time during the process. Although we work hard to make sure that you are informed, there may be information that needs further explanation. You now know more about the “real world” buying process than 90 percent of those who are looking to purchase a home!


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5STEP

6STEP

7STEP

8STEP

9STEP


Application Fee: Fee charged by the lender to offset fixed costs related to mortgage loan processing such as appraisal, credit report, and underwriting.

Closing Fee: The fee charged by the closing attorney who prepares the closing documents and closes the loan on behalf of the lender.

Commitment Fee: This is often called an origination fee.

Discount Points: Each point is equal to one percent of the mortgage amount. The lender uses points to adjust the yield on the mortgage when it is sold to an investor. By paying more points, the borrower can obtain a lower mortgage interest rate.

Funding Fees: Normally applicable to VA loans only, equal to one percent of the loan amount. The fee is due at closing or may be added to the loan amount and financed.

Homeowner’s Insurance : A one-year premium is due in advance at time of closing.

Mortgage Insurance: Insurance that is required by the lender when the down payment is less than 20 percent. In the case of loan default, this insurance reduces the lender’s loss.

Pre-Payables: Adjustments to escrow accounts from the date of closing to the date of the first payment. Interest is paid through the end of the month of closing. Taxes are paid through the end of the month of closing plus the following month. Two months of PMI (Principal Mortgage and Interest) are collected. Two months of homeowner’s insurance must be provided along with a receipt showing that the first year’s premium is paid.

Processing Fees: Fees charged by the escrow processor, either working for the escrow company, title company, or real estate company for administrative services performed from the point of contract through closing.

Recording Fees: Fees charged by state or municipal entities for entering the closing documents into the public record.

Survey Fee: The title company checks the survey for encroachments from within or from outside the subject property.

Title Insurance: Provides protection for lenders and homeowners against financial loss resulting from legal defects in the title.

Underwriting Fee: Practices vary from lender to lender. Check the good faith estimate for the amount of the underwriting fee.

Understanding Closing Costs


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BUYING:THE RISKS YOU FACE AND

HOW TO AVOID THEM

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By utilizing our exclusive service, your home purchase will go smoothly and you will

avoid these common mistakes.

Avoiding the Most Common Mistakes Home Buyers Make

Which are:

Not understanding a local market and all that is available.

Screening the masses, trying to see everything, both in their own price range and not.

Not understanding pricing and the value of certain amenities.

Weak negotiating. This mistake alone can cost a buyer thousands of dollars.

Not requiring the proper inspections.

Not understanding all available financing.

Looking for the perfect home.

Not previewing schools, shopping, and other neighborhood amenities.

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BUYING: THE RISKS YOU FACE AND HOW TO AVOID THEM


HOW TO PREPARE FORTHE FINANCING PROCESS

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9 GREAT REASONS TO GET PRE-APPROVED

1 - Pre-approval determines which loan program best fits your needs.

2 - You won’t waste time considering homes you cannot afford.

3 - You are ready to write and present an offer on the home you really want when you find it.

4 - Your buyer specialist can give the seller a pre-approval letter for you.

5 - In today’s market, with multiple offers on properties, pre-approval puts you in a much better negotiating position.

6 - You will know the amount needed for down payment and closing costs.

7 - If you are a first-time buyer, you may be able to qualify for a special first-time buyer program that may allow you to afford more home for your money.

8 - If you feel you would like and can afford a higher mortgage payment, other options may be available.

9 - Peace of mind.

THE BEST ADVICE...

GET PRE-APPROVEDMost real estate agents and

lenders highly recommend that you, as a home buyer, get

pre-approved with a lender before selecting a home to purchase.

This way, you will have the best information about the

right price range for your pocketbook.

HOW TO PREPARE FOR THE FINANCING PROCESS


Loan Application ChecklistWhen it comes to getting pre-approved for your loan, your lender will ask you for the following items. To expedite the process, have the following information ready when you apply:

Borrower Information:❑ Full name❑ Marital status❑ Age❑ Address❑ Previous address (if less than 2 years at current address)❑ Landlord (past 2 years) ❑ Phone number ❑ Place of employment (past 24 months) ❑ Length of employment ❑ Previous employer (if less than 2 years at current employer) ❑ Social Security number ❑ Name and age of dependents

Income: ❑ Base pay (pay stubs for 1 month) ❑ Overtime ❑ Bonuses ❑ Real estate income ❑ Interest income ❑ Alimony/child support (Copy of Divorce Decree) (Need not be disclosed, if you choose.)

❑ Other regular income (Social Security, retirement accounts, etc.) ❑ Last 2 years’ W2s and federal tax returns ❑ Bank statements (past 3 months)

✓


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Loan Application Checklist(continued)

Assets:

Names and addresses for these accounts will be required along with account numbers. ❑ Cash (savings, checking, money market)❑ Securities (stock, mutual funds) ❑ Value of real estate❑ Proceeds from sale of current home ❑ Cash value of life insurance ❑ Automobiles ❑ Personal property

Liabilities:You will need the total due, monthly payments, and amount of payments remaining.Names, addresses, and account numbers will also be required.

❑ Automobile loan ❑ Bank loan ❑ Real estate mortgage ❑ Personal loan ❑ Notes payable ❑ Credit cards ❑ Alimony/child support ❑ Outstanding judgments ❑ Miscellaneous debt ❑ Bankruptcy and discharge of bankruptcy

✓



QUICK TIPS TO MAKE FINDING YOUR HOME EASIER

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Please review and rank your concerns on the scale from No Concern to Very Concerned.

Areas of Concern No Mildly Somewhat Very

Concern Concerned Concerned Concerned Concerned

Payment Points ❑ ❑ ❑ ❑ ❑Closing Costs ❑ ❑ ❑ ❑ ❑Inspections ❑ ❑ ❑ ❑ ❑Financing ❑ ❑ ❑ ❑ ❑Utility Costs ❑ ❑ ❑ ❑ ❑Upkeep Costs ❑ ❑ ❑ ❑ ❑Schools ❑ ❑ ❑ ❑ ❑Security/Crime ❑ ❑ ❑ ❑ ❑Neighbors ❑ ❑ ❑ ❑ ❑Sport Center ❑ ❑ ❑ ❑ ❑Construction ❑ ❑ ❑ ❑ ❑Architecture ❑ ❑ ❑ ❑ ❑Termites ❑ ❑ ❑ ❑ ❑Floor Plan ❑ ❑ ❑ ❑ ❑Cleanliness ❑ ❑ ❑ ❑ ❑Storage ❑ ❑ ❑ ❑ ❑House Color ❑ ❑ ❑ ❑ ❑Bedrooms/Baths ❑ ❑ ❑ ❑ ❑Kitchen ❑ ❑ ❑ ❑ ❑Family Room ❑ ❑ ❑ ❑ ❑Guest Suite ❑ ❑ ❑ ❑ ❑Office ❑ ❑ ❑ ❑ ❑Yard Size ❑ ❑ ❑ ❑ ❑Landscaping ❑ ❑ ❑ ❑ ❑Patio ❑ ❑ ❑ ❑ ❑Privacy ❑ ❑ ❑ ❑ ❑Horse ❑ ❑ ❑ ❑ ❑Garage ❑ ❑ ❑ ❑ ❑RV Parking ❑ ❑ ❑ ❑ ❑Gated ❑ ❑ ❑ ❑ ❑

What Are Your Concerns?


WHAT’S IMPORTANT TO KNOW ABOUT HOME INSPECTIONS

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WHY EVERY BUYER NEEDS A HOME INSPECTION

Why You, as a Buyer, Need a Home InspectionA home inspection gives you more detailed information to help you make a wise decision. In a home inspection, a qualified inspector takes an in-depth, unbiased look at your potential new home to:

Evaluate the physical condition: structure, construction, and mechanical systems.

Identify items that impact the habitability of the home that will need to be repaired or replaced.

Estimate the remaining useful life of major systems, equipment, structure, and finishes.

What Goes Into a Home InspectionA home inspection gives you an impartial, physical evaluation of the overall condition of the home and items that need to be repaired or replaced. The inspection gives a detailed report on the condition of the structural components, exterior, roofing, plumbing, electrical, heating, insulation and ventilation, air conditioning, and interiors.

Be an Informed BuyerIt is your responsibility to be an informed buyer. Be sure that what you buy is satisfactory in every aspect. You have the right to carefully examine your potential new home with a qualified home inspector. You may arrange to do so before signing your contract, or may do so after signing the contract as long as your contract states that the sale of the home depends on the inspection.

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EXTERIOR Exterior walls, windows, and doors, porches, decks, and balconies, garage.

ROOF Roof type and material.

INTERIOR PLUMBING SYSTEM Hot and cold water system, the waste system and sewage disposal, water pressure and flow, and hot water equipment.

ELECTRICAL SYSTEM Type of service, number of circuits, type of protection, outlet grounding, and load balance.

CENTRAL AIR SYSTEM Energy source, type of cooling equipment, capacity, and distribution.

ATTIC Structural, the trusses, insulation, and ventilation information.

FIREPLACE Notes about the chimney, damper, and masonry.

INTERIOR WALLS, CEILINGS, FLOORS,

WINDOWS, AND DOORSWalls, floors, ceilings, stairways, cabinets, and countertops.

GARAGE Doors, walls, floor, automatic garage door opener.

APPLIANCES Included could be a wide range of built-in and other home appliances listed in the purchase agreement.

LOT AND LANDSCAPING Ground slopes away from foundation, condition of walks, steps, and driveway.


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Most buyers choose to have home inspections done at their expense when purchasing their new home. In fact, many offers are subject to a home inspection. The home inspection allows you to buy a home with confidence. Some items on your inspection report will include:

The Home Inspection

COMMONLY ASKEDBUYER QUESTIONS


QUESTION:

QUESTION:

QUESTION:

QUESTION:

Do “listing agents” prevent “buyers agents” from having full access to all the available properties through the Multiple Listing Service?

A: No! We belong to the Memphis Multiple Listing Service (MLS), so we can show you homes listed with any agent. In addition, since we represent you and not sellers, we regularly show homes thatare For Sale By Owner and For Sale By Builder that are not listed in the MLS.

What if I can’t find a home that I like?A: If you want to put things on hold for a while, don’t worry about being locked into a lengthy contract with us. With our “Easy Exit” agreement, you can cancel at any time! We can start back up when there are more homes to choose from, when the market picks up, or whenever you wish. If you are just having trouble finding the perfect home, we will help you choose building lots, builders, and custom-built homes. In the process, we can save you time, effort, and money!

Q: I went to an open house, and the listing agent said that he could represent me better and “fairer” than any other agent, so I really didn’t need a buyer agent. Is that true?

A: Of course agents try to be fair and nice to the buyer since they want to make the sale. But, because they are bound by Real Estate License Laws, the Law of Agency, and their Code of Ethics, they can only do so much without jeopardizing their license to practice. For instance, the listing agent cannot tell you if a property is overpriced or how to negotiate the best purchase price. Ask yourself if the seller has representation, shouldn’t you? As your buyer agent, we will always negotiate only in the best interest of you, the buyer.

Is there a contract or some other kind of paperwork associated with a buyer agent like there is with a listing agent?A: For years, sellers have been entering into contractual relationships to “list” their properties with real estate brokers. They are called listing agreements. You establish a contractual relationship with us by signing a buyer agency agreementjust as a listing agreement makes the listing agent legally accountable to the seller. The buyer agency agreement is also a written commitment to you of services that we will provide.

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COMMONLY ASKED BUYER QUESTIONS

If you work for the buyer and you negotiate the price down, aren’t you also lowering the amount of commission you will make? Isn’t that a conflict of interest?A: The difference is minimal. If we save you $5,000 on the purchase price of your home, we would only earn approximately $150 less in commission. Your goodwill and word-of-mouth advertising will be worth much more than that. We also have a legal obligation to represent your best interest.

I’m moving to another city. Can you find me a buyer agent at my destination?A: Yes. As soon as you find out that you are moving, call us and we will provide you with the name and phone number of an Accredited Buyer Agent nearest your destination. We will screen agents for you at absolutely no cost whatsoever!

If someone from your team is my buyer agent, how is she paid for her services?A: There are several ways that we can earn our fee. It is always your choice. The typical fee paid to us at closing is paid by the seller and is usually divided between the listing broker (the company who has the home listed for sale) and our broker. Unless there are some unusual circumstances, our portion of the commission comes from the seller’s proceeds of the transaction.

Isn’t the agent who shows me the home representing me?A: If you walk into an open-house, or a new-construction-site model home and any agent tells you that they are the only one who can “write” up the paperwork, don’t believe it! Agents who list properties enter into a signed contract with the seller to represent them in the sale of their property. This same contract may permit the listing agent to use “sub-agents” to help secure a sale. Sometimes these sub-agents will place a sign on the lawn that reads “Buyer Agent On Duty.”Our advice is that unless you have previously interviewed the agent and have entered into a written Agency Agreement wherein they have promised to represent only your best interest and you trust him/her, walk away. You may find yourself working with an agent who is obligated to act in the best interests of the seller.

QUESTION:

QUESTION:

QUESTION:

QUESTION:

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QUESTION:Why should I use an agent to buy a builder’s new construction home?A: The advantages are the same as those for purchasing a resale home. Your agent:

● Serves as your personal real estate advisor.● Guides you through the process with professional representation.● Provides you with valuable insight into the market.● Helps you find the perfect home quickly.● Offers you expertise in contact writing, negotiation, and closing assistance.● Gives you advice regarding all builder’s products.● Finds the best match for your specific needs.

The builder has a professional real estate representative watching out for his interests, and you need and deserve the same expert representation watching out for yours.

It is extremely important that your interests be professionally represented when you enter into a contract for a semi-custom or a build-to-suit home. These transactions are very complex. The contract details must be exactly in order to protect you and to ensure that you get precisely the home you want.

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QUESTION:If I sign an Agency Agreement with the Melissa Thompson Team,does it really matter? Does it really make a difference?A: Absolutely! Yes! Let’s put it this way: If you had to go to court, would you use the other person’s attorney? The second you enter into a contract with an agent, he/she has responsibility and accountability duties. Real estate agents who act as seller agents must negotiate in the best interest of their clients (the sellers) and may not withhold information from them and must present their properties only in a favorable manner. Buyer agents negotiate in the best interests of the buyer, do not disclose confidential information about the buyer, and reveal all facts that affect the value of properties to the buyer.

QUESTION:

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Do I save money if I buy directly from the builder?A: There is absolutely no financial advantage for you to buy directly from the builder. You do NOT save any money! Builders have a “single price” policy, meaning that you are charged the same price whether your interests are represented by a buyer specialist or not. Just as in any resale, the seller pays your agent’s fee. It pays for you to have someone looking out for your personal interests.

Remember, the builder requires that your buyer specialist accompany you on your first visit to the builder’s sales center. Always call our office and request that your buyer specialist show you all builder products that interest you.

If you do go to a builder model/sales center without your buyer specialist, please give the builder’s representative our business card and always tell the builder that you are working with the MelissaThompson Team. Then, be sure to let your buyer specialist know so that they can assist you regarding the builder and their product.

Using a buyer specialist is a definite advantage for you!



OUR CLIENTSSAY IT BEST

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OUR CLIENTS SAY IT BEST

Tommy Kiggins

Tim & Pam Flatt

WHAT OUR CLIENTS HAVE BEEN SAYING

Daniel & Ilana Sellari

Walter & Robin Owen

"Melissa has helped us buy and or sell every home in Memphis we have moved to or rented during the last 9 years of living here. We would never even think of dealing with another realtor! Melissa is the BEST!!!!!!”

"Thank you for all your help in selling our home and for getting us into our new home. Especially with me not being there, I cannot thank you enough for helping Courtney get through the whole closing process on both homes."

Gina Horton

“Melissa did a wonderful job leading us through the process of selling and buying our home. She is knowledgeable of current marketing techniques and was very responsive to our needs. Most importantly, she sold our home quickly in a chal-lenging market.”

"Melissa was very professional and responded to any inquiries with a quickness. Our house only needed to be on the market for 7 days before receiving 2 competing offers that increased the selling price of our home. At the same time, she sent us listings that matched our criteria and showed us homes in a timely manner that enabled us to find, purchase, and move into the new home on the same day we closed on our home! Everything happened so quickly, but it was a smooth and painless process thanks to Melissa's expertise."

"Melissa was prompt, kind and very informed. My husband and I felt very secure in trusting her expertise. She has an awesome team that stayed on top of all our needs and answered all our questions. She loves her work and she made us feel very special. Her joy and confidence gave us the courage to pursue our dream to live in Midtown. Our home sold in less than a week and we were in our new home in less than two months. She is the best! I would recommend her to anyone.”

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OUR CLIENTS SAY IT BEST

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Jason FrazierJosh Fries

David Bowman

Andy & Meredith IrwinRip Crain

Rammy Akil

“Melissa is great! Very helpful and knowledgeable, as first time home buyers, we had lots of questions and looked at many properties and she was always there to help! Even after the sale, she keeps in touch and makes sure everything is taken care of. Best realtor in Memphis!”

“Andy and I want to thank you so much for helping us buy our new house! We could not have imagined a better experience. It was so nice not to worry even during an experience that could be so stressful. We knew you were going to handle everything for us. We really cannot thank you enough for all that you did! Hope to see you soon. Thank you again!”

Bryan &Nancy Sedlacko

“Melissa was a pleasure to work with. She consistently made me feel like I was her only client. She was very professional, friendly, helpful, thoughtful and was there as a guide throughout every step of the process. Melissa is not only a great real estate agent, but I can honestly say she has become a good friend! Many thanks! I would definitely recommend her to anyone looking to buy or sell a home.”

"Just wanted to thank everyone involved. It has been a wonderful experience purchasing my first house and also very smooth and seamless. Thanks again!”

“I have used Melissa in the purchase and selling of two homes. My children have also used Melissa in the purchase of several homes. Melissa is one of the best real estate agents in Memphis. She gets the right price in the minimal amount of time. I highly recommend Melissa!”

“I am very impressed with Melissa's knowledge in real estate. We put our house on the market and she sold it in two weeks. We found our dream home with her help. My son found his first home with Melissa's help. I was surprised how easy she made us feel when buying and selling homes.”

“Melissa is truly the best Realtor in Memphis, Tennessee. She is so helpful in making sure all the things that make a deal come together get done properly. She has sold two houses for my family and if I had more to sell she would certainly be the one to call.”

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CHECKLIST FORA HASSLE-FREE MOVE


CHECKLIST FOR A HASSLE-FREE MOVE

Moving Timeline and Checklist One month before your move:

❑ Arrange for moving your furniture and personal belongings either by hiring a moving company or renting a truck. Get estimates from several moving companies or truck rental companies and be sure to obtain a hand truck (appliance dolly) if you’re moving yourself.

❑ Gather moving supplies: boxes, tape, rope, and anything else you might need.

❑ Plan your travel itinerary and make transportation and lodging reservations in advance if you are driving to your new home. (Leave a copy with a friend or relative.)

❑ Some moving expenses are tax deductible (if the move is employment-related), so you will want to save your moving expense receipts for tax deductions, including meals, lodging, and gasoline. Record expenses incurred during your house hunting trips.

❑ Develop a plan for packing. Pack the things you use the most last. See Tips on Packing in the next section.

❑ Notify others of your new address: post office, charge accounts, subscriptions, relatives and friends, national and alumni organizations, church, mail order clubs (books, videos, catalogues), firms with which you have time payments, and your past employer to make sure that you receive W-2 forms and retirement-account information. Save your old address labels to speed up filling out change-of-address forms for your new address.

❑ Notify federal and state taxing authorities or any governmental agency necessary.

Two weeks before your move:❑ Notify and get refunds from your present utilities: gas, electric, water, cable, and phone. Arrange for services at your new address. Notify long-distance phone company and arrange for service at your new address.

❑ Have your car serviced if you are driving a long distance to your new home.

❑ Recruit people to help you on moving day.

❑ Arrange for someone to take care of your pets and children during the move.

❑ Confirm moving company or rental truck arrangements.

One day before your move:❑ Keep moving materials separate so they don’t get packed until you are finished.

❑ Pick up rental truck if you are moving yourself.

❑ Fill up your car with gas and check oil and tires.

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Additional Moving-Checklist Items❑ Decide what to move and what not to move. Possibly have a garage sale (extra cash and less to move). See “Tips on Having a Garage Sale” on the next page.

❑ Transfer your bank accounts. Your new bank will be happy to open your account by mail or email.

❑ Request records from doctors and dentists, including eye-glass prescriptions, dental x-rays, and vaccinations.

❑ Obtain your children’s school records to make for an easier transfer.

❑ Draw up a floor plan of where your furniture should be placed. This will help avoid confusion for you and your movers.

❑ Pay existing bills and close out local charge accounts.

❑ Arrange any special movers, that may be necessary for an expensive piano or to break down and move a pool table or above-ground swimming pool.

❑ Cancel or transfer deliveries, newspaper, garbage collection, etc. Coordinate the transfer of gas and electric, water and sewer when not handled by title company, with the next occupant of your old home as well as with the previous owner of your new home, so as to avoid lapses in service and extra re-start expenses.

❑ Check on personal items that might be at the photo shop, in a safe-deposit box, at a neighbor’s house, on lay-away, or in a repair shop (e.g., shoe repair, jewelry store, small-appliance repair, or dressmaker).

❑ Make arrangements for transporting your plants and pets. See pages 45 and 46.

❑ Save the phone book from your former city residence for tying up loose ends or for future correspondence.

❑ Transfer insurance policies or arrange for new policies.

❑ Gather all valuables, jewelry, important papers (birth certificates, deeds, documents) to take with you personally.

❑ Pack an arrival kit of necessities just in case you arrive before the mover, if applicable.

❑ Purchase moving insurance. Your mover’s liability for lost or damaged goods will not equal their replacement cost. Have valuable items appraised.

❑ Check with your attorney about your will, if crossing state lines.

❑ Ask for professional referrals if available (e.g., doctor, accountant, etc.).


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Tips on Having a Garage Sale❑ Allow plenty of time (three or four weeks) to prepare for the sale.

❑ Choose a date that will not conflict with holidays.

❑ Weekends are more convenient for most people than weekdays.

❑ Your sale is likely to attract more people if you join together with neighbors in an effort to have more merchandise. Some homeowners’ groups are sponsoring neighborhood sales that are proving popular!

❑ Practical household goods are popular items; adult clothing has less appeal.

❑ Merchandise your items attractively in neat, clean surroundings.

❑ Cluster like-items together; place the more desirable items in the back of the garage so browsers are urged to look at other merchandise on their way to the most popular items.

❑ All items should be clean, polished, and in good repair.

❑ Locate your appliance table near an outlet so customers can try before they buy!

❑ Be sure that there is adequate parking space and a place to load large items.

❑ Have plenty of bags and boxes for packing and newspapers for wrapping glass items.

❑ Place a classified ad in the local paper. Include 3-4 items for sale, directions, & other details.

❑ Take advantage of free publicity on bulletin boards in grocery stores and other public places.

❑ Provide directional signs to your property.

❑ If your home is listed for sale, have flyers about your home available for people to take.

❑ Visit other sales to form an idea on how to price things. Be prepared to bargain down your prices.

❑ Post a notice that all sales are final and payment must be cash.

❑ Have plenty of change in a cash box that is kept in a protected spot. Keep a record of sales, especially when there are several sellers. One recording method that is simple and efficient is to use small white stickers for prices. When an item is purchased, remove the sticker and place it next to the name of the seller on a piece of paper.

❑ On a hot day, have ice water or lemonade available so people will stay longer, and on cold days serve hot chocolate.

❑ Tell your real estate agent about some of the major items in your sale. She/he may have a client looking for just that thing! One person’s trash is another’s treasure!

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Tips on Packing Up❑ Use strong containers that are in good condition and can be secured tightly with twine or strapping tape. These can usually be purchased from your moving company. Purchase special boxes for dishes, wardrobe, and other special items.

❑ Label each box with its contents, which room it should go in, whether it is fragile, and whether it should be loaded last so as to be unloaded first.

❑ Don’t load more than 50 pounds into any one box, and make sure that the weight is evenly distributed.

❑ Cushion contents with newspaper or other packing material to prevent breakage. Use newsprint paper or tissue paper for items that might be soiled by newspaper. Towels and cloth napkins are great for wrapping fragile items.

❑ Pack books tightly in small boxes. Alternate bindings and wrap valuable books separately.

❑ Have your rugs and draperies cleaned before moving and leave them in their wrappings for easier handling.

❑ Remove all breakables and liquids from drawers and pack them separately. Seal medicines and other containers to prevent leaking and pack them in a leak-proof bag or container.

❑ Pack linens and clothing in drawers, but don’t overload them.

❑ Carry all valuables with you. Do not pack jewelry, documents, coin or stamp collections, or anything that will be difficult to replace. The contents of a safety deposit box can be moved for you by your bank.


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43 tel: 901.756.8900 | direct: 901.230.2610 | fax: 901.435.0620 | www.yourkeytomemphis.com

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MOVING WITH CHILDREN(Adapted from information at www.MoversGuide.com.)

If you think moving is hard on grown-ups, imagine what it’s like for kids. They’re starting over and trying to meet new friends while getting used to a new home, neighborhood, and school. Think about your children’s specific needs before, during, and after the change and you’ll make a big difference in how your children feel about the move and how they adjust afterwards.

BEFORE THE MOVE: Preparing❑ Give your children a chance to talk about their feelings and let them know how you are feeling too.

❑ Help them make a list of phone numbers and addresses of friends, relatives, and other important people. Knowing they can stay in touch with these people will be reassuring.

❑ Visit your new home and line up some activities for your child to be part of after the move; a sports team, music lessons, or a scouting troop.

DURING THE MOVE: Remembering What's Important❑ Stay as upbeat and calm as you can. Your own mood will impact your children’s moods.

❑ Involve your children in the packing. Older children can put their own belongings in boxes, and children of all ages will enjoy decorating the boxes containing their things.

❑ Don’t pack things that your children treasure. Take special blankets, favorite books, and other prized items in the car or on the plane with you.

❑ Help your children say goodbye to the important people in their lives. For their friends, a party is a fun way to celebrate the friendship.

❑ For many families, moving day means a long car trip or a cross-country flight. Prevent backseat blues and airline angst by adding travel fun and games to your plans.

AFTER THE MOVE: Getting Settled❑ To make your new home seem more like home, hang your child’s or family portrait in a prominent location or create a tabletop display of family photographs.

❑ Don’t spend too much time unpacking, at least not right away! In the first few days, take time to enjoy your new home with your family. Take walks and check out local restaurants.

❑ Above all, listen. Be there when your children get home after the first day at their new schools, even if it means having to leave work early. Ask often how things are going, and take time to listen.


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Cats and Dogs

Moving Your Pets

Cats and dogs can either be shipped by air or taken along in the car. If you are flying to your new destination, your cat or dog can ride in the baggage compartment. Your pet will need a health certificate from your vet. Call the airline in advance to find out about special boxes they may have. If you are going to make a container for your pet, make sure that the container complies with airline regulations. It is a good idea to put a piece of clothing with your scent in the animal’s box so he/she feels more at home.

If you aren’t flying with your pet but are having him/her shipped by air, make sure that someone is on the other end to pick your pet up at the airport and take care of him/her until you arrive. The easiest way to care for your pet before your arrival is a kennel. Many kennels can take your pet several days before your move (keeping him/her safe and out of your way). Or you can take your pet to the airport and arrange to have a kennel on the other end pick him/her up and take care of him/her until you arrive.

Think twice about taking your dog or cat with you on a long cross-country trip. Not only can animals get car sick, but being cooped up in a car all day can make them nervous and upset. They must be fed and have plenty to drink (make sure that you take along a water dish), they have to make “rest stops,” and they have to be on a leash to keep them from running off anytime the car door is opened.

Some motels and hotels don’t allow pets. Others have special facilities for handling travelers’ pets. Call in advance and check out the available literature on hotels along your route. National chains usually publish such information.

Smaller AnimalsHamsters, birds, mice, and such can be transported in the family car fairly easily. Make sure that the animals have enough food and water in their cages and are out of drafts or extreme temperatures.Cover cages with a cloth to keep the pets quiet and restful.

FishIt is not practical to move fish in their aquarium. A gallon of water weighs eight pounds. Plan on giving the fish away and restock the aquarium when you arrive at your new home.

Your veterinarian and pet stores are also valuable sources of information.


Moving Your House PlantsYou can take your plants with you when you move without harming them. Here are some tips:

❑ Call your local U.S. Department of Agriculture to check on regulations if moving from one state to another. Many states have restrictions on certain kinds of plants to prevent importing bugs or pests that can destroy valuable cash crops in the state.

❑ A couple of weeks before you move, prune plants to facilitate packing. Consult a florist or a plant book for instructions.

❑ A week before you move, put your plants in a black plastic bag. Prior to placing your plant in the bag, place a bug/pest strip, conventional flea collar, or bug powder in the bag. Close the bag and place it in a cool area overnight. This will kill any pests on the plant or in the soil.

❑ The day before you move, put your plants in cardboard containers. Make sure that they are held in place by dampened newspaper or packing paper. Use paper to cushion the leaves and place a final layer of wet paper on top to keep them moist. Water the plants normally in summer, a little less in winter.

❑ On the day of your move, set the boxes aside and mark “DO NOT LOAD” so they won’t be taken on the moving van.

❑ On the day you leave, close boxes, punch air holes in the top, and load them in your car.

❑ When on the road, be careful where you park your car. Look for a shaded area in the summer and a sunny spot in the winter.

❑ Unpack the plants as soon as you can after arriving. Remove plants through the bottom of the box in order to avoid breaking their stems. Do not expose the plants to much sunlight at first. Let them get accustomed to more light gradually.

❑ If you must leave your plants behind, take cuttings. Put them in plastic bags with wet paper towels around them.

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47

GLOSSARYOF TERMS


Abstract of TitleThe summary of the public records relating to the ownership of a particular piece of land. It represents a short legal history of an individual piece of property from the time of the first recorded transfer to present.

AcceptanceConsent to an offer to enter into contract.

Adjustable Rate Mortgage (ARM)A mortgage in which interest and payment rates vary periodically, based on a specific index, such as 30-year Treasury Bills or the Cost-of-Funds index.

AdjustmentsMoney credited or debited to either/both buyer and seller at closing, including real estate taxes, association fees, garbage fees, rents, etc.

AgencyA mutual-consent, legal relationship in which a seller or buyer engages a broker-agent in the sale or purchase of property.

Agent/REALTOR®A licensed person who represents the seller (and/or buyer) and who provides market assessment, offers sales or buying strategy, recommends various services and sources important to the seller or buyer, is a member of the National Association of REALTORS® (NAR), and subscribes to NAR’s strict Code of Ethics.

AmortizationA method by which monthly mortgage payments are equalized over the life of a loan, despite the fact that the proportion of principal to interest changes.

Annual Percentage Rate (APR)The total finance charge (interest, loan fees, points) expressed as a percentage of the mortgage amount.

AppraisalA professional and unbiased written opinion of a property’s value that is based on recent, comparable sales, quality of construction and current condition, and style of architecture.

AppreciationIncrease in value to any cause.

Asking PriceThe price at which a property has been placed on the market for sale.

Assessed ValueThe established value of a property for tax-assessment purposes, which may or may not reflect market value.

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GLOSSARY OF TERMS

GLOSSARY OF TERMS

Assumption of MortgageThe taking of title to property by a grantee, wherein he or she assumes liability for payment of an existing note secured by a mortgage or deed of trust against the property, becoming a co-guarantor for the payment of a mortgage or deed for trust note.

Balloon MortgageA short-term mortgage, generally at a fixed rate of interest, to be paid back in predetermined, equal monthly payments with a large final payment for the balance of the loan to be paid at the end of the term.

BrokerA person licensed to represent home buyers or sellers for a contracted fee. Brokers manage real estate offices and employ licensed agents to sell properties.

Bridge LoanA short-term mortgage made until a longer-term loan can be made; it’s sometimes used when a person needs money to build or purchase a home before the present one has been sold.

Building CodesState and local laws that regulate the construction of new property and the rehabilitation of existing property.

CapA limit on the total amount an interest rate can be increased in a specified time and over the lifetime of an adjustable-rate mortgage.

Capital GainsThe taxable profit derived from the sale of a capital asset. A gain is the difference between the sale price and the basis of the property, after making appropriate adjustments for closing costs, fix-up expenses, capital improvements, allowable depreciation, etc.

ClosingThe final settlement at which time the title is transferred from seller to buyer, accounts are settled, new mortgages are signed, and all fees and expenses are dispersed or satisfied.

Closing CostsAll fees, taxes, charges, commissions, surveys, lender fees, inspection fees, and other costs paid by the buyer and/or seller at the closing.

CommissionA previously agreed upon percentage of the home’s sale price paid to the listing and selling agent(s).

ComparablesSimilar properties in type, size, price, and amenities that have sold recently, been adjusted, and are used for comparison in the appraisal report.


Condominium (Condo)Real estate ownership in which a property owner has title to a specific unit but shared interest in common areas.

ContingencyA condition that must be satisfied before a contract is binding.

ContractAn agreement to do or not to do a certain thing.

Contract for DeedA contract ordinarily used in connection with the sale of a property in cases where the seller does not wish to convey title until all or a certain part of the purchase price is paid by the buyer.

Contract of TitleA summary or digest of the conveyances, transfers, and any other facts relied on as evidence of title together with any other elements or records that may affect the marketability of the title.

Conventional MortgageMost popular home financing form not insured by Federal Housing Administration (FHA) or guaranteed by Veteran’s Affairs (VA). Available from many lenders at varying rates, terms, and conditions.

Conversion ClauseClause in an ARM permitting conversion from an adjustable loan to a fixed-rate loan.

CounterofferAn offer made by a buyer or seller to the other party, responding to the asking price or a subsequent adjustment to that price to complete a purchase of sale.

CRVCertificate of Reasonable Value. A document of appraisal issued by VA establishing their opinion of the maximum value.

Curb AppealA term used by REALTORS® that encompasses all that a buyer sees from the street that may induce the buyer to look more closely at the property.

DeedA legal “instrument” that conveys the title to a property from seller to buyer.

Disclosure LawsState and federal regulations that require sellers to disclose such conditions as whether a house is located in a flood plain or if there are any known defects that would affect the value of the property.

GLOSSARY OF TERMS

50

Discount PointsAdditional charges made by a lender at the time a loan is made. Points are measured as a percent of the loan, with each point equal to one percent. These additional interest charges are paid at the time a loan is closed to increase the rate of return to the lender so as to approximate the market level.

Down PaymentThe buyer and lender determine the down payment requirements during the pre-qualification process. The down payment is usually expressed as a percentage of the purchase price: e.g., 0%, 5%, 10%, 20%, 25%, 30%.

Earnest Money (Escrow Deposit)Money paid by the buyer at the time an official offer to purchase is submitted to the seller, intended to demonstrate the good faith of the buyer to complete the purchase. Earnest money is applied against the purchase price when the sale is finalized. Under certain conditions, the earnest money may be forfeited if the buyer fails to complete the purchase under the terms of the sales contract.

EasementA right to use the land of another.

EncumbranceA condition that limits the interest in a title to property such as a mortgage, deed restrictions, easements, unpaid taxes, etc.

EquityThe difference between the sale price of a property and the mortgage balance owed on the property.

Equity MortgageA mortgage based on the borrower’s equity in their home rather than on their credit worthiness.

Escrow AccountA third-party account used to retain funds, including the property owner’s real estate taxes, the buyer’s earnest money, or hazard insurance premiums.

ExchangeThe trading of equity in a piece of property for equity in another property.

Fair Market ValueThe highest price an informed buyer will pay, assuming there is no unusual pressure to complete the purchase.

Fannie MaeThe Federal National Mortgage Association (FNMA) is a privately owned corporation created by Congress to buy mortgage notes from local lenders and provide guidelines for most lenders to use to qualify borrowers.

GLOSSARY OF TERMS


Fee AppraisalThe act or process of estimating values of real estate or any interest therein for a fee.

FHA-Insured MortgageA loan made by a local lending institution and insured by the Federal Housing Administration, whereas the buyer pays the premium.

Firm CommitmentA lender’s agreement to make a loan to a specific borrower on a specific property. An FHA or Private Mortgage Insurance (PMI) agreement to insure a loan on a specific property, with a designated purchaser.

Fixed-Rate MortgageA mortgage with a set interest rate for the entire term of the mortgage.

FMHA LoanA loan insured by the Federal Home Loan Mortgage Corporation (FHLMC), a federally controlled and operated corporation to support the secondary-mortgage market.

ForeclosureA legal procedure whereby mortgaged property is seized and sold as payment for a debt in the event of default.

Freddie MacThe nickname for Federal Home Loan Mortgage Corporation (FHLMC), Freddie Mac is a federally controlled and operated corporation to support the secondary-mortgage market. It purchases and sells residential conventional home mortgages.

Graduated-Payment MortgageThis mortgage offers low initial monthly payments that increase at a predetermined rate and then cap at a final level for the duration of the mortgage.

Home InspectionA formal survey of a home’s structure, mechanical systems, and overall condition, generally performed by an inspector or contractor.

Home WarrantyA policy available to the buyer or seller as insurance against unanticipated home-repair costs.

Homeowner’s PolicyA hazard insurance policy covering, at the very least, the appraised value of a house and property.

Inspection ContingencyA written stipulation contained in an “offer to buy” that makes the sales contract predicated upon the findings of a professional home inspector.

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GLOSSARY OF TERMS

GLOSSARY OF TERMS

Installment DebtsLong-term debts that usually extend for more than one month.

InterestThe predetermined charge or fee paid to a lender by the borrower for the use of monies loaned.

InvestorThe holder of a mortgage or the permanent lender. Any person or institution that invests in mortgages.

Joint TenancyJoint ownership by two or more persons with right of survivorship; all joint tenants own equal interests and have equal rights in the property.

Land ContractA contract ordinarily used in connection with the sale of property in cases where the seller does not wish to convey title until all or a certain part of the purchase price is paid by the buyer.

Lease Purchase AgreementThe buyer makes a deposit for the future purchase of property with the right to lease the property in the interim.

LienA legal claim against a property that must be paid when the property is sold.

ListingA contract through which a seller agrees to terms and fees with an agent who will sell the property to a buyer.

Loan CommitmentA written promise by a lender to make a loan under certain terms and conditions. These include interest rate, length of loan, lender fees, annual percentage rate, mortgage and hazard insurance, and other special requirements.

Loan-to-Value RatioThe relationship between the amount of a home mortgage and the total value of the property.

Lock-In RateA commitment made by lenders on a mortgage loan to “lock in” an interest rate pending mortgage approval. Lockin periods vary.

Market PriceThe actual price at which a property is sold.

Market ValueThe price that is established for a property by existing economic conditions, property location, size, etc.


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Marketable TitleMerchantable title, free and clear of objectionable liens or encumbrances.

MoldMold is a superficial and often woolly growth produced on damp or decaying organic matter or on living organisms. See www.epa.gov/iag/molds/moldguide.html for a guide that provides information and guidance for homeowners and renters on how to clean up residential mold problems.

MortgageA legal claim received by the lender on a property as security for the loan made to a buyer.

MortgageeThe lender of money or the receiver of the mortgage document.

Mortgage BrokerAn independent, third-party, licensed broker who arranges loan transactions between lenders and borrowers by facilitating the application and approval process.

Mortgage Insurance Premium (MIP or PMI)The consideration paid by a mortgagor for mortgage insurance either to the FHA or a PMI company. On an FHA loan, the payment is one half of one percent annually on the declined balance of the mortgage. It is a part of the regular monthly payment and is used by the FHA to meet operating expenses and provide loss reserves.

MortgagorThe borrower of money or the giver of the mortgage document.

Multiple Listing Service (MLS)A system through which participating brokers agree to share commissions on a predetermined percentage split on the sale of properties listed on the system.

Origination FeeThis fee is a supplemental fee paid buy buyers to lenders, usually stated as a percentage or as points.

Personal PropertyAny property which is not real property: e.g., money, savings accounts, appliances, cars, boats, etc.

PITICommon real estate acronym meaning Principal, Interest, Taxes, Insurance.

PointA single percent of the loan principal, often charged by the lender in addition to various fees and interest.

GLOSSARY OF TERMS

PrepaymentWhen a borrower pays off an entire mortgage before the scheduled payoff date.

Prepayment Penalty

Prequalification

A fee included in the mortgage agreement that is required of the borrower in the event the loan is paid of before the due date. Look for a clause that says, “There shall be no prepayment penalty.”

An informal estimate of the “financing potential” of a prospective borrower.

PrincipalThe amount of money borrowed against which interest and possibly fees will be charged. OR: One of the parties to a contract.

Private Mortgage Insurance (PMI)Insurance issued to a lender by a private company to protect the lender against loss on a defaulted mortgage loan. Its use is usually limited to loans with high loan-to-value ratios. The borrower pays the premiums.

Promissory NoteA written contract that contains a promise to pay a definite amount of money at a specific time in the future.

ProrationProportionate division of expenses based on days or time occupied or used by the seller and/or buyer.

Purchase Agreement

Qualification

A written, legally binding contractual agreement between a buyer and a seller for the purchase of real estate.

Ability of a borrower to satisfy a lender’s mortgage-approval requirements.

RadonA colorless, odorless gas formed by the breakdown of uranium in sub-soils. It can enter a house through cracks in the foundation or in water and is considered to be a hazard. Your REALTOR® can supply a radon brochure.

Real PropertyAny land and whatever by nature or artificial annexation is a part of it.

Referral

Refinancing

The recommendation by one agent of a potential buyer and/or seller to another agent either locally or long distance.

The process of applying for a new mortgage to gain better terms or use of equity.

GLOSSARY OF TERMS


Relocation SpecialistsA firm or person specializing in advising buyers or sellers on relocating to different and/or new communities. There are designations for REALTORS® that indicate additional educational training. Look for the Certified Relocation Professional (CRP) designation.

Return on Investment (ROI)The profit gained as the result of money spent on an improvement or addition to a home or property.

Settlement Disclosure StatementA statement or list providing a complete breakdown of costs involved in finalizing a real estate transaction prepared by the lender’s agent prior to closing and reviewed at closing by the buyer and seller.

SurveyThe process by which a parcel of land is measured and its area ascertained. Title companies study the survey to check for encroachments.

TitleA legal document that defines the property, right of ownership, and possession.

Title DefectAn outstanding claim or encumbrance on property that affects marketability.

Title InsuranceAn insurance policy that protects the buyer against errors, omissions, or any defects in the title.

Title SearchA highly detailed search of the document history of a property title for the purpose of identifying any and all legal encumbrances to the property prior to title transfer to a new owner.

VA MortgageThe Department of Veterans Affairs has made guaranteed mortgages available through banks and other lending institutions to active military personnel, veterans, or spouses of veterans who died of service-related injuries.

Walk-Through InspectionThe final inspection by the buyers, usually in the company of the buyers’ real estate sales agent, to ensure that all conditions noted in the offer to purchase and all seller-related contingencies have been met. This inspection is most often completed immediately prior to the closing and after the seller has vacated the premises.

ZoningVirtually all local communities have established specific restrictions for land use, new construction, and remodeling activity. These are available to you through a local regulatory department such as the Building Inspector’s Department or office or the Planning and Zoning Board.

GLOSSARY OF TERMS

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62

PURCHASINGCONTRACTS

CRYE-LEIKFREAL ESTATE SERVICES

PURCHASE AND SALE AGREEMENT

1 1. Purchase and Sale. For and in consideration of the mutual covenants herein and other good and valuable consideration,2 the receipt and sufficiency ofwhich is hereby acknowledged, the undersigned buyer3 ("Buyer'') agrees to buy and the4 undersigned seller ("Seller")5 agrees to sell all that tract or parcel of land, with such improvements as are located thereon, described as follows:6 All that tract of land known as:7 (Address) (City), Tennessee, (Zip), as recorded in8 County Register of Deeds Office, deed book(s), page(s),9 and/or instrument number and as further described as:

10 together with all11 fixtures, landscaping, improvements, and appurtenances, all being hereinafter collectively referred to as the "Property."12 A. INCLUDED as part of the Property (if present): all attached light fixtures and bulbs including ceiling fans;13 permanently attached plate glass mirrors; heating, cooling, and plumbing fixtures and equipment; all doors, storm14 doors and windows; all window treatments (e.g. shutters, blinds, shades, curtains, draperies) and hardware; all wall-15 to-wall carpet; range; all built-in kitchen appliances; all bathroom fixtures and bathroom mirrors; all gas logs,16 fireplace doors and attached screens; all security system components and controls; garage door opener and all (at17 least ) remote controls; swimming pool and its equipment; awnings; permanently installed outdoor cooking18 grills; all landscaping and all outdoor lighting; mailbox(es); attached basketball goals and backboards; TV mounting19 brackets (but excluding flat screen TVs); antennae and satellite dishes (excluding components); and central vacuum20 systems and attachments.

21 B. Other items that REMAIN with the Property at no additional cost to Buyer:

22

23

24 C. Items that WILL NOT REMAIN with the Property:

25

26

27 D. LEASED ITEMS: Leased items that remain with the Property: (e.g., security systems, water softener systems, tiiel28 tank, etc.): .29 Buyer shall assume any and all lease payments as of Closing. If leases are not assumable, the balance shall be paid30 in full by Seller at or before Closing.31 • Buyer does not wish toassume a leased item. (THIS BOX MUST BE CHECKED IN ORDER FORIT TO32 BE A PART OF THIS AGREEMENT.)33 Buyer does not wish to assume Seller's current lease of ; therefore. Seller34 shall have said lease cancelled and leased items removed from Property prior to Closing.35 E. FUEL: Fuel, if any, will be adjusted and charged to Buyer and credited to Seller at Closing at current market prices.

36 2. Purchase Price, Method of Payment and Closing Expenses. Buyer warrants that, except as may be otherwise37 provided herein. Buyer will at Closing have sufficient cash to complete the purchase of the Property under the terms of38 this Purchase and Sale Agreement (hereinafter "Agreement"). The purchase price to be paid is:39 $ , U.S. Dollars,40 ("Purchase Price") which shall be disbursed at Buyer's expense and paid to Seller or Seller's Closing Agency in41 immediately available fimds in the form ofone of the following:42 i. a Federal Reserve Bank wire transfer;43 ii. a Cashier's Check issued by a financial institution as defined in 12 CFR § 229.2(i);44 iii. a check issued by the State ofTennessee or a political subdivision thereof;45 iv. a check issued by an instrumentality O'fthe United States organized and existing under the Farm Credit Act of46 1971; OR47 v. in other such form as is approved in writing by Seller.

48 A. Appraisal (Select either 1 or 2 below. The sections not checked are not a part of this Agreement).49 • 1- This Agreement IS NOT contingent upon the appraised value either equaling orexceeding the agreed upon50 Purchase Price.

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51 Q 2. This Agreement ISCONTINGENT upon the appraised value either equaling orexceeding the agreed52 upon Purchase Price. If appraised value is equal to or exceeds Purchase Price, this contingency is satisfied.53 If the appraised value of the Property does not equal or exceed the Purchase Price, Buyer may terminate54 this Agreement by providing vi^ritten notice to the Seller and providing written proof of the same (for55 example, this written proof could include, but is not limited to, a copy of appraisal or a signed letter from56 Lender) via the Notification form or equivalent written notice. Upon termination. Buyer is entitled to57 refund of the Earnest Money.

58 B. Closing Costs and Discount Points.59 1. Seller Expenses. Seller shall pay all existing loans and/or liens affecting the Property, including all penalties,60 release preparation costs, and applicable recording costs; any accrued and/or outstanding association dues or61 fees; fee (if any) to obtain lien payofC^estoppel letters from any and all associations, mortgage holders or other62 liens affecting the Property; Seller's closing fee, document preparation fee and/or attorney's fees; fee for63 preparationof deed; and notary fee on deed. Seller additionallyagrees to permit any withholdingsand/or to pay64 any additional sum due as is required under the Foreign Investment in Real Property Tax Act. Failure to do so65 will constitute a default by Seller.66 In the event Seller is subject to Tax Withholding as required by the Foreign Investment in Real Property67 Tax Act, (hereinafter **FIRPTA*'), Seller additionally agrees that such Tax Withholding must be collected68 from Seller by Buyer's Closing Agent at the time of Closing. In the event Seller is not subject to FIRPTA,69 Seller shall be required as a condition of Closing to sign appropriate affidavits certifying that Seller is not70 subject to FIRPTA. It is Seller's responsibility to seek independent tax advice or counselprior to the Closing71 Date regarding such tax matters.

72 2. Buyer Expenses. Buyer shall pay all transfer taxes and recording fees on deed ofconveyance and deed of trust;73 Buyer's closing fee, document preparation fee and/or attorney's fees; preparation of note, deed of trust, and74 other loan documents; mortgage loan inspection or boundary line survey; credit report; required premiums for75 private mortgage, hazard and flood insurance; required reserved deposits for insurance premiums and taxes;76 prepaid interest; re-inspection fees pursuant to appraisal; insured Closing Protection Letter; association fees as77 stated within paragraph 4.E.; and any costs incident to obtaining and closing a loan, mcluding but not limited to:78 appraisal, origination, discount points, application, commitment, underwriting, document review, courier,79 assignment, photo, tax service and notary fees.

80 3. Title Expenses. Cost of title search or abstract, mortgagee's policy and owner's policy shall be paid as follows:81 .82 Buyer to receive benefit of simultaneous issue.

83 Not all of the above items are aoDlicable to everv transaction and mav be modified as follows:

84

85

86 Closing Agency for Buyer:87 Closing Agency for Seller:88 Title Company:89 or other Closing Agency as mutually agreed by Seller and Buyer.

90 C. Financial Contingency - Loan(s) To Be Obtained. This Agreement is conditioned upon Buyer's ability to obtain91 a loan(s) in the principal amount up to % of the Purchase Price listed above to be secured by a deed of92 trust on the Property. "Ability to obtain" as used herein means that Buyer is qualified to receive the loan described93 herein based upon Lender's customaryand standardunderwriting criteria. In Ae event Buyer, having acted in good94 faith and in accordance with the terms below, is unable to obtain financing. Buyer may terminate this Agreementby95 providing written notice and a copy of Lender's loan denial letter via the Notification form or equivalent written96 notice. Upon termination. Buyer is entitled to a refund of the Earnest Money. Lender is defined herein as the97 financial institution funding the loan.

98 The loan shall be of the type selected below (Select the appropriate boxes. Unselected items will not be part of99 this Agreement):

100 • Conventional Loan • FHA Loan; attach addendum101 • VA Loan; attach addendum • Other102 Buyer may apply for a loan with different terms and conditions and also Close the transaction provided all other103 terms and conditions of this Agreement are fulfilled, and the new loan does not increase any costs charged to Seller.104 Buyer shall be obligated to Close this transaction if Buyer has the ability to obtain a loan with terms as described105 herein and/or any other loan for which Buyer has applied and been approved.

106 Loan Obligations: The Buver aerees and/or certifies as follows:

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107 (1) Within five (5) days after the Binding Agreement Date, Buyer shall make application for the loan. Buyer108 shall immediately notify Seller or Seller's representative of having applied for the loan and provide109 Lender's name and contact information, and that Buyer has instructed Lender to order credit report and110 appraisal via the Notification form or equivalent written notice;

111 (2) Within fourteen (14) days after the Binding Agreement Date, Buyer shall warrant and represent to Seller112 via the Notification form or equivalent written notice that

113 a. all required Lender deposits, including appraisal cost and credit report, have been paid as evidenced by114 supporting documentation (e.g. cancelled check, receipt fi-om Lender, letter from loan originator, etc.);115 and

116 b. Buyer has available flmds to Close per estimates of Lender / loan originator.

117 (3) Buyer shall pursue qualification for and approval of the loan diligently and in good faith;

118 (4) Buyer shall continually and inmiediately provide requested documentation to Lender and/or loan119 originator,

120 (5) Unless otherwise stated in this Agreement, Buyer represents that this loan is not contingent upon the lease121 or sale ofany other real property and the same shall not be used as the basis for loan denial; and

122 (6) Buyer shall not intentionally make any material changes in Buyer's financial condition which would123 adversely affect Buyer's ability to obtain the Primary Loan or any other loan referenced herein.

124 Should Buyer fail to timely comply with 2.C.(1) and/or 2.C.(2) above and provide notice as required. Seller may125 make written demand for compliance via the Notification form or equivalent written notice. If Buyer does not126 furnish Seller the requested documentation within two (2) days after such demand for compliance. Buyer shall be127 considered in default and Seller's obligation to sell is terminated.128 THIS BOX MUST BE CHECKED IN ORDER FOR IT TO BE A PART OF THIS AGREEMENT.

129 • Financing Contingency Waived (e.g. "All Cash", etc.): Buyer's obligation toclose shall not besubject toany130 financial contingency. Buyer reserves the right to obtam a loan. Buyer will furnish proofofavailable funds to close131 in the following manner: (e.g. bank statement. Lender's commitment132 letter) within five (5) days after Binding Agreement Date. Failure to Close due to lack of fimds shall be considered133 default by Buyer.134 3. Earnest Money. Buyer has paid or will pay within days after the Binding Agreement Date to135 (name of Holder) ("Holder")136 located at (address of Holder), an137 Earnest Money deposit of $ by check (OR )138 ("Earnest Money").

139 A. Failure to Receive Earnest Money. In the event Earnest Money is not timely received by Holder or Earnest140 Money check or other instrument is not honored for any reason by the bank upon which it is drawn Holder shall141 promptly notify Buyer and Seller of the Buyer's failure to deposit the agreed upon Earnest Money. Buyer shall then142 have one (1) day to deliver Earnest Money in immediately available funds to Holder. In the event Buyer does not143 deliver such funds. Seller shall have the right to terminate this Agreement by delivering to Buyer or Buyer's144 representative written notice via the Notification form or equivalent written notice. In the event Buyer delivers the145 Earnest Money in immediately available funds to Holder before Seller elects to terminate. Seller shall be deemed to146 have waived his right to terminate, and the Agreement shall remain in full force and effect

147 B. Handling of Earnest Money upon Receipt by Holder. Earnest Money is to be deposited promptly after the148 Binding Agreement Date or Ae agreed upon delivery date in this Earnest Money paragraph or as specified in the149 Special Stipulations paragraph contained at paragraph 18 herein. Holder shall disburse Earnest Money only as150 follows:

151 (a) at Closing to be applied as a credit toward Buyer's Purchase Price;

152 (b) upon a written agreement signed by all parties having an interest in the funds;

153 (c) upon order ofa court or arbitrator havingjurisdiction over any dispute involving the Earnest Money;154 (d) upon a reasonable interpretation of the Agreement; or

155 (e) upon the filing of an interpleader action with payment to be made to the clerk of the court having156 jurisdiction over the matter.

157 Holder shall be reimbursed for, and may deduct fi-om any funds intetpleaded, its costs and expenses, including158 reasonable attorney's fees. The prevailing party in the interpleader action shall be entitled to collect from the other159 party the costs and expenses reimbursed to Holder. No party shall seek damages from Holder (nor shall Holder be160 liable for the same) for any matter arising out of or related to the performance of Holder's duties under this Earnest

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161 Money paragraph. Earnest Money shall not be disbursed prior to fourteen (14) days after deposit unless written162 evidence ofclearance by bank is provided.

163 4. Closing, Prorations, Special Assessments and Warranties Transfer.164 A. Closing Date. This transaction shall be closed ("Closed") (evidenced by delivery of warranty deed and payment of165 Purchase Price, the "Closing"), and this Agreement shall expire, at 11:59 p.m. local time on the day of166 , ("Closing Date"), or on such earlier date as may be agreed to by the167 parties in writing. Such expiration does not extinguish a party's right to pursue remedies in the event of default.168 Any extension of this date must be agreed to by the parties in writing via the Closing Date/Possession Date169 Amendment or equivalent written agreement.170 1. Possession. Possession of the Property is to be given (Select the appropriate boxes below. Unselected items171 will not be part of this Agreement):

172 • with delivery ofwarranty deed and payment ofPurchase Price;173 OR

174 n o'clock • am/ • pm, local time;175 • Occupancy Agreement Attached.176 B. Prorations. Real estate taxes, rents, dues, maintenance fees, and association fees on said Property for the calendar177 year in which the sale is Closed shall be prorated as of the Closing Date. In the event of a change or reassessment of178 taxes for the calendar year after Closing, the parties agree to pay their recalculated share. Real estate taxes, rents,179 dues, maintenance fees, and association fees for prior years and roll back taxes, if any, will be paid by Seller.

180 C. Special Assessments. Special assessments approved or levied prior to the Closing Date shall be paid by the Seller181 at or prior to Closing unless otherwise agreed as follows:182 .

183 D. Warranties Transfer. Seller, at the option of Buyer and at Buyer's cost, agrees to transfer Seller's interest in any184 manufacturer's warranties, service contracts, termite bond or treatment guarantee and/or similar warranties which by185 their terms may be transferable to Buyer.186 E. Association Fees. Buyer shall be responsible for all homeowner or condominium association transfer fees, related187 administration fees, capital expenditures/contributions incurred due to the transfer of Property and/or like expenses188 which are required by the association, property management company and/or the bylaws, declarations or covenants189 for the Property (unless otherwise specifically addressed herein and/or unless specifically chargeable to Seller under190 applicable bylaws, declarations, and/or neighborhood covenants).

191 5. Title and Conveyance.192 A. Seller warrants that at the time of Closing, Seller will convey or cause to be conveyed to Buyer or Buyer's assign(s)193 good and marketable title to said Property by general warranty deed, subject only to:194 (1) zoning;

195 (2) setback requirements and general utility, sewer, and drainage easements of record on the Binding196 Agreement Date upon which the improvements do not encroach;

197 (3) subdivision and/or condominium declarations, covenants, restrictions, and easements of record on the198 Binding Agreement Date; and

199 (4) leases and other encumbrances specified in this Agreement.

200 If title examination, closing or loan survey pursuant to Tenn. Code Ann. § 62-18-126, boundary line survey, or other201 information discloses material defects. Buyer may, at Buyer's discretion:202 (1) accept the Property with the defects OR

203 (2) require Seller to remedy such defects prior to the Closing Date. Buyer shall provide Seller with written204 notice of such defects via the No-tification form or equivalent written notice. If defects are not remedied205 prior to Closing Date, Buyer and Seller may elect to extend the Closing Date by mutual written agreement206 evidenced by the Closing Date/Possession Amendment form or other written equivalent. If defects are not207 remedied by the Closing Date or any mutually agreed upon extension thereof, this Agreement shall208 terminate, and Buyer shall be entitled to refund of Earnest Money.

209 Good and marketable title as used herein shall mean title which a title insurance company licensed to do business in210 Tennessee will insure at its regular rates, subject only to standard exceptions. The title search or abstract used for211 the purpose of evidencing good and marketable title must be acceptable to the title insurance agent and the issuing212 title insurance company. Seller agrees to execute such appropriate affidavits and instruments as may be required by213 the issuing title insurance company.

214 B. Deed. Deed is to be made in the name of .215 The manner in which Buyer takes title determines ownership and survivorship rights. It is the Buyer's responsibility216 to consult the closing agency or attorney prior to Closing.

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217 6. Seller's Property Disclosure. Pursuant to the requirements of the Tennessee Residential Property Condition Disclosure218 Act at Tenn. Code Ann. § 66-5-201, et seq. as amended, a Property Condition Disclosure Statement, Exemption, or if219 Buyer waives Disclosure, a Disclaimer, has been or will be provided prior to the Binding Agreement Date.220 7. Lead-Based Paint Disclosure (Select the appropriate box below. Items not selected are not part of this221 Agreement).222 • does not apply. • does apply (Property built prior to 1978 - see attached Lead-Based Paint Disclosure).223 8. Inspections.224 A. Buyer's Right to Make lnspection(s). All inspections/reports, including but not limited to the home Inspection225 report, those required/recommended in the home inspection report, Wood Destroying Insect Infestation226 Inspection Report, septic inspection and well water test, are to be made at Buyer's expense, unless otherwise227 stipulated in this Agreement. The parties hereto agree that in the event Buyer shall elect to contract with a third228 party inspector to obtain a "Home Inspection" as defined by Tennessee law, said inspection shall be conducted by a229 licensed Home Inspector. However, nothing in this paragraph shall preclude Buyer from conducting any inspections230 on his/her own behalf, nor shall it preclude Buyer from retaining a qualified (and if required by law, licensed)231 professional to conduct inspections of particular systems or issues within such professional's expertise or licensure,232 including but not limited to inspection of the heating/coolingsystems, electrical systems, foundation, etc., so long as233 said professional is not in violation ofTenn. Code Ann. § 62-6-301, et seq. as may be amended. Seller shall cause234 all utility services and any pool, spa, and similar items to be operational so that Buyer may complete all235 inspections and tests under this Agreement Buyer agrees to indemnify Seller from the acts of himself, his236 inspectors and/or representatives in exercising his rights under this Purchase and Sale Agreement. Buyer's237 obligations to indemnify Seller shall also survive the termination of this Agreement by either party, which shall238 remain enforceable. Buyer waives any objections to matters of purely cosmetic nature (e.g. decorative, color or239 finish items) disclosed by inspection. Buyer has no right to require repairs or alterations purely to meet240 current building codes, unless required to do so by governmental authorities. In the event Buyerfails to timely241 make such inspections and respond within said timeframe as described herein^ the Buyer shall haveforfeited any242 rights provided under this Paragraph 8^ and in such case shall accept the Property in its current condition^243 normal wear and tear excepted,

244 B. Initial Inspections. Buyer and/or his inspectors/representatives shall have the right and responsibility to enter the245 Property during normal business hours, for the purpose of making inspections and/or tests of the Property. Buyer246 and/or his inspectors/representatives shall have the right to perform a visual analysis of the condition of the247 Property, any reasonably accessible installed components, the operation of the Property's systems, including any248 controls normally operated by Seller including the following components: heating systems, cooling systems,249 electrical systems, plumbing systems, structural components, foundations, roof coverings, exterior and interior250 components, any other site aspects that affect the Property, and environmental issues.

251 C. Wood Destroying Insect Infestation Inspection Report If desired by Buyer or required by Buyer's Lender, it252 shall be Buyer's responsibility to obtain at Buyer's expense a Wood Destroying Insect Infestation Inspection Report253 (the "Report"), which shall be made by a Tennessee licensed and chartered pest control operator.254 The foregoing expense may be subject to governmental guidelines relating to VA Loans (See VA/FHA Loan255 Addendum if applicable).

256 The inspection shall include each dwelling, garage, and other permanent structure on the Property excluding257 for evidence of active infestation and/or damage.258 Buyer shall cause such Report to be delivered to Seller simultaneously with any repairs requested by the Buyer or259 the end of the Inspection Period, whichever is earlier. If the Report indicates evidence of active infestation. Seller260 agrees to treat infestation at Seller's expense and provide documentation of the treatment to Buyer prior to Closing.261 Requests for repair of damage, if any, should be addressed in the Buyer's request for repairs pursuant to262 Subparagraph 8.D., Buyer's Inspection and Resolution below.

263 D. Buyer's Inspection and Resolution. Within days after the Binding Agreement Date ("Inspection264 Period"), Buyer shall cause to be conducted any inspection provided for herein, including but not limited to the265 Wood Destroying Insect Infestation Inspection Report AND shall provide written notice of such to Seller as266 described below. In said notice Buyer shall either:267 (1) furnish Seller with a list of written specified objections and immediately terminate this Agreement via the268 Notification form or equivalent written notice, provided Buyer has conducted a Home Inspection or other269 inspection(s) as allowed herein, and in good faith discovers matters objectionable to Buyer within the scope270 of such inspection(s). As additional consideration for Buyer's right to terminate, Buyer shall deliver to271 Seller or Seller's representative, upon Seller's request, a copy ofall inspection reports. All Earnest Money272 shall be returned to Buyer upon termination.273 OR

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274 (2) accept the Property in its present "AS IS" condition with any and all faults and no warranties expressed or275 implied via the Notification form or equivalent written notice. Seller has no obligation to make repairs.276 OR

277 (3) furnish Seller a written list of items which Buyer requires to be repaired and/or replaced with like quality or278 value in a professional and workmanlike manner. Seller shall have the right to request any supporting279 documentation that substantiates any item listed.

280 a. Resolution Period. Seller and Buyer shall then have a period of days following receipt of281 the above stated written list ("Resolution Period") to reach a mutual agreement as to the items to282 be repaired or replaced with like quality or value by Seller, which shall be evidenced by the283 Repair / Replacement Amendment or written equivalent(s). The parties agree to negotiate284 repairs in goodfaith during the Resolution Period. In the event Seller and Buyer do not reach a285 mutual written resolution during such Resolution Period or a mutually agreeable written extension286 thereofas evidenced in an Amendment to this Agreement signed by both parties within said period287 of time, this Agreement is hereby terminated. If terminated. Buyer is entitled to a reflmd of the288 Earnest Money.

289 • E. Waiver ofAU Inspections. THIS BOX MUST BECHECKED TO BE PART OF THIS AGREEMENT.290 Buyer, having been advised of the benefits of inspections, waives any and all Inspection Rights under this291 Paragraph 8 (including but not limited to the Wood Destroying Insect Infestation Inspection Report).

292 9. Final Inspection. Buyer and/or his inspectors/representatives shall have the right to conduct a final inspection of293 Property no later than days prior to the Closing Date only to confirm Property is in the same or better condition294 as it was on the Binding Agreement Date, normal wear and tear excepted, and to determine that all repairs/replacements295 agreed to during the Resolution Period, if any, have been completed. Property shall remain in such condition until296 Closing at Seller's expense. Closing of this sale constitutes acceptance of Property in its condition as of the time of297 Closing, unless otherwise noted in writing.

298 10. Disclaimer. It is understood and agreed that the real estate firms and real estate licensee(s) representing or assisting299 Seller and/or Buyer and their brokers (collectively referred to as "Brokers") are not parties to this Agreement and do not300 have or assume liability for the performance or nonperformance of Seller or Buyer. Buyer and Seller agree that Brokers301 shall not be responsible for any of the following, including but not limited to those matters which could have been302 revealed through a survey, flood certification, title search or inspection of the Property; for the condition of the Property,303 any portion thereof, or any item therein; for any geological issues present on the Property; for any issues arising out of304 the failure to physically inspect Property prior to entering into this Agreement and/or Closing; for the necessity or cost of305 any repairs to the Property; for hazardous or toxic materials; for the tax or legal consequences of this transaction; for the306 availability, capability, and/or cost of utility, sewer, septic, or community amenities; for any proposed or pending307 condemnation actions involving Property; for applicable boundaries of school districts or other school information; for308 the appraised or fiiture value of the Property; for square footage or acreage of the Property; for any condition(s) existing309 off the Property which may affect the Property; for the terms, conditions, and availability of financing; and/or for the310 uses and zoning of the Property whether permitted or proposed. Buyer and Seller acknowledge that Brokers are not311 experts with respect to the above matters and that they have not relied upon any advice, representations or statements of312 Brokers (including their firms and affiliated licensees) and waive and shall not assert any claims against Brokers313 (including their firms and affiliated licensees) involving same. Buyer and Seller understand that it has been strongly314 reconmiended that if any of these or any other matters conceming the Property are of concern to them, that they secure315 the services of appropriately credentialed experts and professionals of Buyer's or Seller's choice for the independent316 expert advice and counsel relative thereto.

317 11. Brokerage. As specified by separate agreement. Seller agrees to pay Listing Broker at Closing the agreed upon318 compensation. The Listing Broker will direct the closing agency to pay the Selling Broker, from the compensation319 received, an amount in accordance with the terms and provisions specified by separate agreement. The parties agree and320 acknowledge that the Brokers involved in this transaction may receive compensation from more than one party. All321 parties to this Agreement agree and acknowledge that any real estate firm involved in this transaction shall be deemed a322 third party beneficiary only for the purposes of enforcing their commission rights, and as such, shall have the right to323 maintain an action on this Agreement for any and all compensations due and any reasonable attorney's fees and court324 costs.

325 12. Default. Should Buyer default hereunder, the Eamest Money shall be forfeited as damages to Seller and shall be applied326 as a credit against Seller's damages. Seller may elect to sue, in contract or tort, for additional damages or specific327 performance of the Agreement, or both. Should Seller default. Buyer's Eamest Money shall be refunded to Buyer. In328 addition. Buyer may elect to sue, in contract or tort, for damages or specific performance of this Agreement, or both. In329 the event that any party hereto shall file suit for breach or enforcement of this Agreement (including suits filed after330 Closing which are based on or related to the Agreement), the prevailing party shall be entided to recover all costs ofsuch331 enforcement, including reasonable attorney's fees.

Copyright2014©Tennessee Association of Realtors*F9 - Purcliase and Sale Agreement, Page 6 of 9 Version 02/01/2014

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