What paperwork is needed to sell a house?

What paperwork is needed to sell a house?

Selling a house involves gathering a comprehensive set of documents, typically categorized into three main stages: Preparation/Listing, Contract & Disclosures, and Closing.

In the U.S., the exact requirements can vary slightly by state, but the following checklist covers the essential paperwork needed for a legitimate sale:

1. Property and Financial Documents (Preparation Phase)

These are the papers you should gather before listing your home:

• Property Deed: The legal document proving you own the property. You may need to obtain a new copy from your county recorder’s office if the original is lost.
• Mortgage Payoff Statement: A statement from your lender detailing the exact amount needed to fully pay off your existing mortgage(s) and any home equity lines of credit (HELOCs).
• Property Survey/Plat: A legal document showing the property boundaries, easements, and structures.
• Property Tax Records: Your most recent property tax bills to show the buyer the current tax liability.
• Homeowners Insurance Records: Documentation showing past claims or repairs can be helpful for the buyer’s own insurance estimates.
• Homeowners Association (HOA) Documents (if applicable): Bylaws, rules, fee schedules, and a statement confirming your dues are paid up to date.
• Repair and Maintenance Records: Receipts and warranties for major repairs, upgrades, or new appliances that will transfer with the home (e.g., roof, HVAC, water heater).

2. Legal and Disclosure Documents (Contract Phase)

These are forms you must complete and provide to the buyer once an offer is accepted:

• Seller’s Disclosure Statement: A legally required form in most states where you must disclose any known defects or issues with the home (e.g., water damage, structural problems, pest issues).
• Lead-Based Paint Disclosure: Required by federal law for all homes built before 1978.
• Purchase and Sale Agreement: The final, legally binding contract signed by both you and the buyer, detailing the agreed-upon price, closing date, and contingencies (like inspection and financing).

3. Closing Documents (Finalization Phase)

These documents are prepared by the title company, escrow agent, or closing attorney and are signed on closing day:

• The Deed (Signed by Seller): The final legal document that officially transfers ownership of the property to the buyer. This is signed, notarized, and then recorded with the county.
• Closing Disclosure (CD): A statement that itemizes all costs and financial transactions for both the buyer and the seller, detailing how the money is distributed and the net proceeds of the sale.
• Affidavit of Title: A sworn statement affirming that you have the right to sell the property, that there are no hidden liens or claims against the title, and that no recent work has been done that would allow a contractor to place a lien on the property.
• Loan Payoff Documentation (if applicable): Final instructions and confirmation that your existing mortgage will be paid off.
• 1099-S Tax Form: A form used to report the sale of the home to the IRS (Internal Revenue Service) for tax purposes.
• Bill of Sale (if applicable): A document listing any personal property being transferred with the home (e.g., appliances, window treatments).

What the Seller Needs to Bring to Closing:

• Government-Issued Photo ID: Driver’s license or passport for verification.
• House Keys, Remotes, and Access Codes: Keys, garage door openers, and security codes for the new owner.
• Cashier’s Check or Proof of Wire Transfer: If you owe any money at closing (e.g., for prorated taxes or unexpected closing costs), you’ll need certified funds.
• Forwarding Address and SSN: Needed for the closing agent to send tax documents and any final proceeds.

When a sale of a house, the owner gets what kind of paperwork?

When a house sale is finalized (Closing), the seller receives several key documents that confirm the transaction’s completion and are essential for tax purposes and record-keeping.

The seller’s final paperwork package, usually provided by the title company, escrow agent, or closing attorney, primarily includes:

1. Financial Settlement Documents (Most Crucial for Taxes)

• Seller’s Closing Disclosure (CD) / Settlement Statement: This is the most important financial document. It provides a detailed, itemized breakdown of the entire transaction, showing:
  • The final sale price.
  • All credits (money owed to the seller, including the sale price and prorated prepaid expenses).
  • All debits (money owed by the seller, including the mortgage payoff, agent commissions, closing costs, and prorated property taxes/HOA fees).
  • The final Net Proceeds (the amount the seller actually receives).
• Form 1099-S: This is the official tax form issued by the closing agent to the seller and the IRS, reporting the proceeds from the real estate sale. It is necessary for calculating capital gains taxes.
• Mortgage Payoff Statement / Release of Lien: A document from the seller’s former mortgage lender confirming that the outstanding loan balance has been paid in full and the lien on the property has been officially released.

2. Legal Confirmation Documents

• Copy of the Deed: The seller signs the original deed to transfer ownership to the buyer. The seller retains a copy to prove the transfer was executed. (The buyer receives the original recorded deed.)
• Affidavit of Title (Signed by Seller): A copy of the sworn statement provided by the seller confirming clear ownership and the absence of undisclosed liens or legal claims against the property.
• Bill of Sale (if applicable): A document listing any personal property (e.g., appliances) that was transferred to the buyer as part of the sale.

3. Supporting Documents to Retain

It is highly recommended that the seller keep a file containing copies of the following documents from the process, especially for seven years or longer:

• The Original Purchase & Sale Agreement: The core contract setting the terms of the deal.
• All Seller Disclosures: Copies of the forms (like the Lead-Based Paint Disclosure) provided to the buyer. This protects the seller against potential future claims by the buyer.
• Receipts for Capital Improvements: Receipts for major renovations (like a new roof, kitchen remodel, or addition) made during the seller’s ownership. These can be used to increase the “cost basis” of the home, which helps reduce the amount of profit subject to capital gains tax.