Selling land by yourself might sound like a simple process. You have the land, someone wants to buy the land, and then you sell it to them. Sounds easy, but there’s a lot more to it than that, especially if you’re going the For Sale By Owner route. Regardless of whether you sell it yourself or work with a real estate agent, there are going to be a series of documents that you need to know about and use in order to complete a sale. While there are ways around this, such as selling your land directly to a cash buyer, let’s take a closer look at the documents you’ll need to be aware of in this guide to sell land in Texas.
The Documents You Will Need To Sell Land By Owner
Purchase Agreement
The first document you’ll need, and perhaps the most important one of all, is a purchase agreement. The purchase agreement is a legal document that the buyer will sign as part of their offer on the land. This document indicates that the buyer has an intention to go through with the purchase and is serious about meeting the terms of the agreement.
While some of the languages in the purchase agreement will be fairly boilerplate, there should be some very specific descriptions related to your land and property. It should include a description of the premises that match the actual acreage or borders. If the land is described in vague terms or differs from any other plans, that can mess up financing or legal approvals. The negotiated price should be included in both numbers and words. The buyer will have to provide a deposit and the total amount should be noted in the document. It should also note what the seller will do with that deposit during the process. If the seller is providing financing on the deal, the agreement should note the specifics involved. That includes amounts, interest rates, terms of repayment, and any mortgage language. Also, note what happens if the buyers miss payments and how a default will work.
The agreement should also note if there are any improvements such as wells or walls that have been promised. Note the condition of any existing items as well. Make sure the closing date and any potential extensions are noted in the document as well. It’s possible a buyer will need more time than agreed-upon, so allow for that if it works for both sides. There should also be language in there about what happens if you decide you want to back out of the deal and what kind of penalties are involved.
Disclosure Document
While you might be honest and upfront about how you present the land, any smart buyer is going to require a disclosure document as part of the transaction. You should want it too as a way to create a paper trail that corroborates everything you’ve shared about the property. These are required by law in most places so it’s not really up for debate in many cases.
A property disclosure statement outlines any issues or problems that the seller is aware of that could have a negative impact on the value of the land. Most buyers will receive the disclosure statements once their offer has been accepted. This way, the buyer can review the documents and then hire an inspector to check the land out, keeping a close eye on the specifics laid out in the disclosures. It’s a helpful tool for buyers to know what to look for in order to make sure they’re happy with the transaction.
The U.S. government requires that certain things, such as asbestos and lead-based paints, are disclosed in all situations. Texas and its counties will each have their own specific rules and requirements as well. Some places require disclosures if there was a death on the property while others may require acknowledging if any sex offenders live nearby, so be sure to check your local regulations.
Everyone who has owned the land or was an agent or inspector involved in the purchase of the land is liable if something happens in the future, so disclosure agreements are a way of protecting not just the seller but everyone else involved in the sale. If there is something in a disclosure agreement that is confusing or unclear to either party, this is the time to clarify it. The buyer can always back out of the deal (though they’d probably forfeit earnest money deposits). Keep in mind that if you didn’t disclose a problem you were completely unaware of, that doesn’t necessarily mean you’ve done anything wrong. That’s why inspections are critical.
Contract For Sale
If the buyer is purchasing your land in Texas with secured financing or cash, there is going to need to be a contract for sale. This contract will lay out all of the terms of the sale and might also include a list of other documents required in order to complete the same. These would include financial documents related to the way the land will be purchased and how any financing will be done. The contract for sale might also include information related to title insurance. As such a title company might have to get involved in the transaction in order to provide that and a chain of information proving it.
Deed
In order to transfer the title of the land from the seller to the buyer, you’ll need a deed. If the buyer is paying via financing or cash, the deed will need to be presented at closing and should be brought by the seller. The deed will then need to be transferred to the buyer and then filed with all appropriate local, state, and federal government agencies. If the seller is providing financing, a deed is still necessary but it should be kept in escrow until the final payment is made by the buyer. Once payment is completed, the deed will be filed with the county clerk and other relevant government agencies. Then it will be transferred to the buyer.
Other Relevant Documents
A closing statement will be required if you are financing the deal, as all credits and debits need to be detailed. A title agency or attorney can create that for you. It may also include a schedule that shows the projected payments needed by the buyer. Other documents that will need to be created include a copy of property insurance as well as a topographical map of the property that includes clear boundaries.
Avoid Documents, Sell As-Is to Cash Buyer
The list of documents needed to sell land on the open market can sound burdensome, along with all the regulations and rules you have to follow. You have to do a lot to prep the land, market the land, and find a potential buyer willing to meet you at your price. And you can do everything correctly and still not find a buyer, which can be frustrating.
Another option is to skip all the hassle and sell the vacant land directly to a cash buyer like Very Fast Home Buyers. The name might sound like we just buy homes, but we will buy vacant land and lots from you as well and without any commissions or extra fees.
All you need to do is reach out and let us know about the property. We’ll assess the land and make you a fair cash offer with no obligation. If you accept the offer, we’ll pay you cash and take over ownership. The best part is that you don’t need to even bother cleaning up, prepping the land, or doing anything other than presenting the land as-is.