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Be careful if you buy the furniture along with the house

A surprising number of home buyers make an offer for a house that includes some items of the seller’s personal property – they want to keep certain furniture, pieces of artwork, a pool table, a boat at the dock, etc.

There’s nothing wrong with this, but it does create some complexities that you should be aware of.

For instance, lenders typically won’t include the value of the “extras” in a mortgage loan – it’s simply too much trouble to foreclose on a sofa. So if you’re paying $300,000 for a house, and the price includes furniture that the lender thinks is worth $15,000, you’ll only get a mortgage for $285,000 – you’ll have to pay the rest out-of-pocket.

Certain items, though, are typically included with the house. These include major appliances, window treatments, and lighting and plumbing fixtures. Flat-screen TVs can go either way, and it often depends on whether the TV is attached to the wall.

There have been a few unusual cases where a new home (usually a vacation home) is intended to be sold fully furnished, and a bank has financed the full cost. But this is rare.

Real estate agents typically don’t get a commission on the value of the extras, so they generally leave such negotiations up to the buyer and seller directly.

Finally, you should consider taxes when you make such an offer. If you buy a lot of furniture or a boat, you might owe sales tax. And if the extras are wrapped up into the cost of the home, it might increase any real estate transfer tax.

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