FAQ for Homebuyers in New Jersey

My agent has asked me to sign a contract of sale, should I?

Yes, in New Jersey it is customary for a real estate broker to prepare a standard form contract. This contract is subject to a three day Attorney Review Process. So make sure that you contact your attorney immediately because Attorney Review starts with the first business day.

What is Attorney Review?

After signing the contract of sale, the parties have three business days to have the contract reviewed by their attorney. During this time period, your attorney will review the contract and prepare what is called a rider or letter addendum to the contract. The Rider will create additional provisions to the contract, both attorneys trying to make the terms most favorable to their client and addressing any issues that have not been already addressed by the initial contract.

Representing a Buyer, your attorney should try to extend the deadlines for your mortgage commitment and inspection report, as well as giving you the most flexibility to get out of the transaction, if your inspection report is unfavorable or if you are unable to secure a mortgage.

If you are buying a condominium, co-op or a townhouse, this firm will put in a provision requesting copies of important documents, including the Master Deed, Bylaws as well as the House Rules of the Condo Association, in addition to the financial documents, including a budget, and/or financial statements, which will show the financial stability of the building.

Once the attorneys and their clients accept each other’s newly added terms, the attorneys will sign off on the final Rider and inform all parties that attorney review is concluded. All time periods (for the mortgage contingency and inspection results) will start from this date (not the date you signed the initial contract with your broker).

Should I get the property inspected?

The only inspection usually required by a lender is a termite or wood destroying insect inspection.
Most lenders will require an “Infestation Certificate” showing that there is no visible evidence of infestation in the home. You must provide this certificate to the lender before they will clear your file for closing.

However since you are buying the property “As Is” it is a good idea to have a structural inspection performed by a licensed inspector or engineer. The inspection will give you the opportunity to accompany the inspector around the property and learn recommended maintenance for your new home. In addition, you may be able to negotiation a credit at closing for some defects found during the home inspection.

Depending on the age and condition of your building, you may choose to get inspections in the following areas: radon, septic, well, home heating oil tank, asbestos, mold, stucco and/or lead paint.

We also strongly suggest that you order an underground oil tank sweep, to determine if there are underground oil tanks on the property. Often, in the contract, the sellers represent that there are no underground oil tanks on the property, when in fact there is a tank that the seller is not aware of.

If there is a well and/or septic system on the property we suggest that you have it inspected. The buyer pays for this inspection. There are a few different types of septic inspections available. You should discuss the various available tests with your home inspector.

If there’s a well on the property, the parties will have to comply with the recently enacted Private Well Testing Act, N.J.S.A. 58: 12a-26 to 37. Typically the seller pays for the cost of the well testing. The tests currently take a long time to complete, so they should be ordered as soon as attorney review is completed. At closing both parties are required to sign a certificate reflecting that they have both received and reviewed the well test results.

You will generally have between 10-14 days to get the inspection done and submit the results to the Seller’s attorney. You should schedule an appointment with an inspector immediately following attorney review. Any defects will be submitted by your attorney for the Seller’s attorney to address, usually with a credit at closing or a repair of the defect.

A structural inspection generally runs about $250 for a condominium and $300+ for a one family home. This is an out of pocket expense that you pay directly to the inspector. You will work with your real estate broker and the seller to coordinate this.

What is a title search?

A title search is a search conducted by licensed agency to find any judgments against the parties, show any unpaid tax liens and provide a copy of the recorded deed and mortgage for the Seller. It is conducted to make sure that the Seller can provide clear title to the property to the new Buyers. Our law firm will order the title search after attorney review is complete. It takes approximately two weeks for the title search to be completed. When title is received, it is reviewed by our office for defects, and then submitted to your lender. Your lender needs to approve the title before they will clear you to close. Once you close, you will have insured title to the property even though the actual title insurance policy will not be issued for many months after the closing.

What is title insurance?

Title insurance is an insurance policy that covers your ownership interest and the mortgage interest of your lender. You will be required to purchase title insurance for your property by your lender. Title is ordered from an independent title company. Title insurance prices are state regulated, so that the cost of title insurance does not change from company to company. We charge you the amount that is charged to us by the title company.

Who orders the survey and why do we need a survey?

The survey is a like a map that shows the placement of the dwelling relative to the perimeter of the property lines. Our law firm will order the survey together with the title search once attorney review is complete. Almost all lenders require that a survey be drawn and submitted to them for approval, prior to closing. In some cases the lender will accept an existing survey if it is not too old and if the Seller can give an Affidavit saying that there have been no changes to the property since the date of the survey. If an existing survey is available, and you wish to rely upon it, you must let us know so that we do not order a new survey for you. A survey for a one family house costs approximately $500.00 and a survey certificate for condo costs about $225.00. Title insurance, title searches and the survey costs are paid at closing.

Do I need an appraisal?

The appraisal determines the market value for the property you are purchasing. It is ordered by the lender and generally the buyer is charged a fee by the lender for the appraisal. The appraisal is not provided to us in advance, and usually is not available at the closing. Most lenders require that you send them a letter within 90 days after the closing in order to receive a copy of the written appraisal.

What do I need to bring to the closing?

At the closing you will need to bring a certified check, bank check, or cashier’s check. You will be provided with the exact amount of the check as soon as the numbers are available to us.

In addition, you should bring proof of homeowner’s insurance (declaration page and one year paid receipt). It is also a good idea to bring a few personal checks in the unlikely event minor adjustments need to made between the parties at closing.

If you are married, bring your spouse, or if you purchased the home with a partner, you must both be present at the closing.

Who will be at the closing and how long will it take?

The closing will be attended by you and your spouse or partner, and you will be represented your attorney. Usually a representative of the lender does not attend the closing but sends all documentation by overnight delivery or email. The other party, represented by their attorney, will also be present at the closing. However, it is not unusual for a Seller not to attend in person, but to pre-sign all closing documents and to send an attorney as their legal representative. Often, the realtors will also attend the closing. A closing usually takes approximately 1 to 2 hours.

Where will the closing be held?

It is custom and practice in New Jersey, and most Contracts provide, that the closing will occur at the office of the Buyer’s attorney. If you are buying new construction, the closing will most likely occur at the office of the builder’s attorney.


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