5. ADDITIONAL DOCUMENTATION AT CLOSING. The SELLER agrees to execute and deliver simultaneously with the delivery of the Dead such certifications as may reasonably be required by the BUYERS attorney or the BUYER’S mortgage lender including, without limitation, documents relating to the absence of tenants in the premises the absence of mechanic’s or materialmen’s liens, the payment of municipal liens the absence of UFFI at the premises and the SELLERS compliance with requirement imposed upon residential sellers with respect to UFFI by statute and applicable regulations, the underlying financial terms of the purchase and sale, the citizenship and residency of the SELLER, and the SELLER’S taxpayer identification number and forwarding address.
This paragraph was added in order to remove a closing table issue that occurs once in a while where Seller refuses to sign additional documents that are required by the Buyer’s lender. There was a closing a couple of years ago where the Seller refused to sign such documentation at the closing and the closing fell through. Litigation ensued and the Seller prevailed! The Court found that eth Seller was only obligated to tender a deed and was not under any legal obligation to provide any additional documentation. The problem of course was that the Buyer’s Lender would not proceed without the additional documentation.
Typically the additional documentation includes an affidavit regarding “mechanic’s liens – liens that a contractor can place on the property within 90 days of completing any work at the premises. Such liens could become the responsibility of the new owner – so the Bank wants extra warranties from the Seller in case such a lien is placed on the property. Another form that the banks’ cannot seem to rid their closing packages of is a statement from the seller regarding a UFFI, a foam insulation that is no longer on the market and also no longer harmful even if it is in a home. Also, a statement regarding the legal status of a Seller and a social security number for tax purposes are common forms that the Buyer’s attorney may require at the time of closing.
I personally, have never had an attorney refuse to sign or have their Seller client sign a document required by my Buyer’s bank. But, just in case they ever try to avoid signing such a document, it is nice to have this paragraph in the contract!