If you sell or buy a property, you may notice the inclusion of the movable property in the purchase or sale agreement. Moveable property may complicate the purchase or sale according to the contract and the manner in which the real estate broker stipulates it. A movable property is any object in the dwelling that is not attached to the property itself. This can be from artwork to appliances to window coverings.
Unlike movable property, fixed fixtures are locked in the property and can not be moved or removed. A painting hanging on the wall of the corridor: the painting is a movable property, because it is easily removed and is not immobilized in the property.
A luminaire mounted on the wall of the corridor: the luminaire is a fixed accessory, because it is not easily removed from the property and constitutes a permanent improvement of it.
How important is this distinction?
A common mistake in written purchase contracts is the inclusion of prices for movable property. From a mortgage point of view, any object listed in the purchase contract should be included in the purchase price. Mortgage lenders provide funds for property and not for personal belongings.
A purchase agreement indicates that the buyer would pay $ 3,500 for artwork already in the home. The mortgage lender would not provide funds for the purchase of these objects. The owner of the house must pay this amount.
It is different if the purchase agreement stipulates that the art objects are included in the property. Usually, appliances are included in the price of the property. It is important to note that the purchase price of the property can not be inflated to take into account the appliances. The mortgage lender provides loans against the fair market value of the property, which is typically determined through an appraisal.
If in doubt, we recommend that you consult a real estate broker about any item you want to include in the purchase or sale price, such as appliances, window coverings and other real estate.