Buying a home is the largest and most important purchase you will make in your life. This purchase will involve many legal issues that don’t exist with other purchases you will make. A skilled lawyer is trained to deal with these problems.
Home Buying Process
When you find a home you want to buy, negotiations are conducted through the real estate agents for both buyer and seller. Once an informal agreement is reached, the parties then execute a formal Purchase and Sale Agreement. This is a legally binding contract. The parties then have about 30 to 45 days to close the deal. During this time, the buyer must apply for and obtain a home mortgage – unless he/she is paying cash. Title is then searched to see if there are any liens or clouds on the title. If all goes well, the property is then transferred from the seller to the buyer by way of a Warranty Deed. This process seems simple, but without a lawyer, the consequences can be disastrous.
Avoid Unclear Terms
A real estate lawyer can help you avoid some major problems with the purchase. Real estate agents typically use standard forms, expecting that they will cover all circumstances and conditions. Well, they don’t. The standard Purchase and Sale Agreement does not deal with a number of legal problems. Thus, a skilled agent, or real estate lawyer, will often add additional terms to the contract.
A lawyer can explain the consequences of not getting a loan commitment on time, the effects of latent (hidden) damages to the property, the strict tax liability the buyer has when seller is a foreign national, failure of the seller to deliver good marketable title, any many more. The standard forms used by most agents can have the blanks filled in easily in about 7 or 8 minutes. However, there are 12 pages of detailed legal language that you need to understand. After all, one misinterpretation could cost you thousands of dollars, or even the loss of your dream home. An attorney should also determine if the contract was properly signed.
The purchase contract is the most important document in the transaction. A lawyer can explain the contract and modify it so that it benefits the buyer. Typical contract issues that a lawyer will address are:
* If the property has been altered in any way, was it done legally?
* If the buyer plans to change the property, can it be done legally?
* What happens if the buyer finds termites, asbestos, radon, or lead-based paint on the property after a sale contract is signed?
* What if the buyer finds hazardous material on the property?
* What if the closing does not take place when scheduled, and what happens to the down payment?
* Will the down payment be held in escrow by a lawyer?
* What if the buyer cannot obtain financing?
After the contract is signed, buyer must determine whether seller has good and complete title to the property. This is done by a title search by the title insurance company who is conducting the closing. A lawyer will review the title search and explain the title exceptions as to what is not insured, and determine whether the legal description is correct. He can also explain any easements, restrictions and other clouds on title.
The closing is the final step. This is the process whereby title transfers to buyer. The title company will prepare a closing statement, reflecting the debits and credits to both buyer and seller. A lawyer can explain the nature, amount, and fairness of the closing costs. The Warranty Deed and loan documents are signed at this time and the lawyer can verify that all documents are legally executed.
The closing process can be confusing and complex to the buyer and seller. Those present at the closing often include the buyer and seller, their respective attorneys, the title closer (representative of the title company), an attorney for any lending institution, and the real estate broker. There may also be last minute disputes about delivering possession and personal property or the adjustment of various costs, such as fuel and taxes. If you are the only person there without a lawyer, your rights may be at risk.
For more information on how a lawyer can help you when you buy a home, please contact real estate broker and attorney at law David Dowell, by phone/text at (407) 864-2265, email at david@PanAmOrlando.com, or visit us online at www.PanAmOrlando.com