Buying and selling a home is a long, complicated process. From the seemingly endless sea of papers requiring your John Hancock, to the mental and emotional stress of parting with an old house or greeting a new one, any steps you can take to make things easier on yourself will pay dividends. One of the more mysterious, and therefore stressful, components of real estate transactions can be the legal implications. That’s why we’ve gathered legal experts from Miami to Sacramento. Read on for useful tips and considerations – you’ll be glad you did.
Be aware of any judgments against you
One of the most shocking phone calls a home buyer can get from Escrow is where they advise you there is a judgment against you. This happens a lot more often than you think and can stop a purchase/sale dead in its tracks. Many times this is not a loan qualification issue, but a title insurance issue. The best thing to do, even if you are pre-qualified for a loan, is doing a record check at the county courthouse before you open escrow. This can be done online. If you do have a judgment against you, you will want to contact a lawyer to resolve it before you close escrow. – Fitzgerald & Campbell
Run a background check on the property’s association
If you are considering purchasing a house, townhome, or condominium that is governed by an HOA or Condo Association you would be wise to do a little research into that association before making the commitment. A simple court records search will give you a glimpse at all the lawsuits the association has been involved in and can be a good indicator as to how adversarial and, in some cases, even abusive they are. Associations file lawsuits to foreclose over delinquent assessment payments; for rule violations; etc. They can also be sued by residents for failure to observe operating requirements; for violating Fair Housing laws; etc. If you’re not sure how to go about performing the search, simply reach out to a local attorney familiar with real estate and association laws and he/she can provide you with the data and a practical summary. – Fleysher Law
Invest in a quality home inspection
The Home Inspection should be done by a licensed home inspector, who should be able to recognize if an illegal structure exists in the property. For instance, the bathroom may have been remodeled with a shower installed without the filing of local permits, and it violates building codes by being too small or not having the proper drainage. If an inspector does not understand local codes and omits this from his report, the county will hold the purchaser liable until the illegal structure is reconstructed to code. That can cost tens of thousands of dollars in construction costs plus thousands more in daily fines until the construction is completed to code. You can also go to the website of the local building department to look up if there are any permit violations on the property. – Susan Chana Lask, Esq.
Most buyers know that they should definitely have a home inspection done on the property during their “contingency period” to ensure there are no defects. However not all inspectors are the same, and many don’t offer any sort of warranty of their work. Don’t simply choose the least expensive inspector, choose a company that has been in business at least 5 years and will offer not just an “opinion” but an actual warranty (often through a partner) that the home is in good condition free of defects. Although this is an extra expense, it can offer you the insurance you need to know if anything is discovered as a defect someone else is paying for the repair. Yes, you’d have recourse against the seller in most cases but this involves costly litigation and that’s the last place you want to end up. Choosing an expert, experienced home inspector to really crawl around to every part of the house can save you in the long run. – McFarlin LLP
Pay close attention to the preliminary title report
Buyers should pay particular attention to the preliminary title report they receive through escrow. The preliminary title report will tell the buyer about any recorded liens on the property, easements and other knocks on the title that may negatively affect the homeowner in the future. Too often buyers overlook the title report and do not give it the attention it deserves. Study the title report thoroughly and ask questions to the title company or an attorney if you do not understand it. – Schorr Law
Know what you’re buying
Attorneys conduct their own due diligence once they receive a proposed contract of sale, but a purchaser who has already done their homework will understand any issues that might arise and can be guided accordingly.
For single-family homes, this would include anything such as termite inspections, engineer inspections, and a personal walk through of the property to conduct a visual inspection. For co-ops, this would include reviewing certain documents such as the offering plan and amendments, building financials for the last two years, the by-laws, house rules, a review of the board minutes and confirming details of the property such as what is included and the assessments and maintenance fees with management.
For any property: always research the property address on PropertyShark and check out the taxes, the current homeowner, and even the amount the seller previously paid. – Pardalis & Nohavicka Attorneys
Hire an attorney for your closing
It’s very important to hire an attorney for your closing. Many title companies in Kentucky and Indiana are not owned and operated by an attorney. Clients usually pay the same price whether they work with an attorney or not. People often even think they are working with an attorney, but they aren’t. There are lots of things that can come up through the transaction, and there are also last-minute legal concerns that might arise regarding contract review, clear title, financing, disclosures, breach of contract, or loan documentation. Something as simple as a missing signature or having the wrong person sign can void or delay a transaction. – The English Law Group
While most, if not all, homebuyers will invest in obtaining a home inspection in order to determine the condition of the property, sellers must be aware that in virtually all states the common law approach of “buyers beware” no longer exists. Sellers must use reasonable care and diligence in disclosing any known current or past material conditions of the property that may affect its value or desirability. Sellers should discuss with the agent the disclosures that their particular state laws require and be aware of the fact that a failure to disclose could result in a lawsuit and substantial damages, including attorney’s fees. – Law Office of Lee A Drizin
Buyers are often concerned that the seller and/or real estate agent isn’t telling them something about the property. Unfortunately, not every seller or real estate agent is honest and above-board and some may not even know what their obligations are related to disclosing the condition of the property. If a buyer has concerns, then an experienced real estate lawyer should be able to suggest contact language to address these concerns, including the inclusion of a property disclosure statement as part of the contract. – Sackrin & Tolchinsky Attorneys at Law
Disclose. One of the biggest disputes between Sellers and Buyers is the failure to disclose defects. – Law Office of Joel R. Spivack
Order a preliminary title report
Order a preliminary title report before you list the property for sale so you can clear up any judgment liens or other “surprises” that appear on the title. It may be worthwhile to enlist a consumer rights attorney to challenge or negotiate judgments – don’t just roll over and pay them to close the sale. – Law Offices of Henry & DeGraaff
Consult with a professional
Hire an experienced real estate lawyer to protect your interests. As purchasing a home is one of the biggest investments that someone makes in their life, it is strongly recommended that every buyer has a real estate lawyer in their corner to help ensure that you’re getting what you’re paying for. A real estate lawyer will assist with monitoring important deadlines, negotiations, and with the review of title, lien searches, surveys, and closing documents. – Law Office of Ryan S. Shipp