Point of Sale Procedure
If you are selling a residential property in Shaker Heights, you are required to submit the Point of Sale (POS) application prior to entering into a contract with a buyer. An inspection must then be scheduled with the City. In order to allow for sufficient time for the inspection process and to ensure adequate time to correct any violations, property owners are encouraged to obtain a POS inspection prior to placing their home on the market. Prior to transfer, either all violations must be corrected, or funds equal to 150 percent of the estimated cost of repairs must be placed in an escrow account held by the City. A property owner may object to having a POS inspection. In that situation, the owner must still submit a POS application to put the City on notice of the intent to transfer the property, and the City will then be required to request a search warrant from the Shaker Heights Municipal Court in order to perform the inspection.
- Start the process with the Point of Sale Process Application (PDF)
- View all Point of Sale Forms and Documents
Learn More about Point of Sale Inspections
The Point of Sale inspection is a visual inspection of the interior and exterior of a residential property that is required as part of the POS process before entering into an agreement to sell the property. The inspection takes about 90 minutes, during which a City inspector will systematically check over the property. View exterior inspection guidelines (PDF) and interior inspection guidelines (PDF).
Sellers are advised to allow at least two weeks from the date of application for the Point of Sale Process and three to four weeks during the busy spring real estate season.
Fees for the Point of Sale Process, including the inspection, are:
- Single-family home: $200
- Two-family home: $300
- Condominium: $150
- Apartment building: $200 for the first unit; $50 per additional unit
Please note, returned checks will incur an additional $15 charge.
After the Point of Sale inspection, the seller will receive either a Certificate of Compliance or a Certification of Inspection.
- A Certificate of Compliance means the property has successfully passed the Point of Sale inspection. It is valid for one year from the date of issuance.
- A Certificate of Inspection means that the inspector has identified violations that must be corrected.
Whether proceeding with a sale or removing the property from the market, the seller has 90 days to correct the violations and schedule a re-inspection. If the property passes the re-inspection, the seller will receive the Certificate of Compliance.
Repairing Point of Sale Violations
Typically, the seller of the residential property repairs any violations discovered during the Point of Sale inspection. However, a buyer may also assume all or part of the responsibility. If violations will remain after the transfer of title, the buyer or seller must submit an itemized estimate of the remaining repairs that was prepared by a registered contractor . Once reviewed and approved, either the buyer or the seller is required to establish an escrow account in the amount of 150 percent of the cost of the repairs. Please view Point of Sale Inspection & Escrow Requirements (PDF) for detailed information.
The City recognizes it can take time to repair some violations, especially for those where weather can be a factor. Extensions on the 90-day period will be made in cases where progress on repairs is satisfactory, but incomplete. Use this form to request an extension.
As an alternative to funding a POS escrow account for homes where the buyer is assuming violations, buyers may request that they be permitted to substitute a purchase rehab loan product that the buyer has obtained for the escrow account. While not appropriate in all cases, the City will evaluate the proposal based on the following criteria:
- The Lender’s must have oversight and management of the loan.
- The Buyer must demonstrate that the amount of the loan is sufficient to fully pay for the correction of all violations.
- The total loan amount should exceed the amount needed just to correct code violations.
- City’s experience with the Lender in other purchase-rehabilitation loans.
- The Buyer must show that they will live in the home as their primary residence.
- Any other factor that would tend to support a conclusion that the intent of the POS escrow provisions will be met by the structure and terms of the loan.
If you feel a purchase rehab loan product might work in your situation, please discuss with your realtor. In order to request use of a purchase rehab loan in-lieu of funding the POS escrow, please submit your request in writing or email to the Building and Housing Department along with evidence of the terms of the purchase-rehabilitation loan. Please include sufficient detail that will allow us to evaluate whether the terms meet the above outlined criteria.
While purchase rehab loans can take on many forms by different lenders, HUD 203(K) Rehab Mortgage Insurance is one such program that is used by many buyers.