Buying or selling a property is a major transaction in most people’s lives. By the time a deal is ready to be made, people are often in a hurry to get the contract signed and move forward. But as much as you may want to close quickly, be sure to take the time to read the contract and have an attorney review it for possible flaws that can impair the value you expect to receive.
Here are some red flags that an experienced real estate attorney can spot during the contract process:
Lack of financing details — The contract should clearly state how the property is being paid for. If there will be a mortgage contingency, there should be details about the type of loan – e.g. conventional, FHA, VA, etc. – and what the terms are. The contingency clause should specify not only the amount of the loan but also the timeline. As a seller, you don’t want to get into a situation where the buyer is still waiting for mortgage approval a few days before closing.
Incomplete or inaccurate documents — A large volume of paperwork must be completed in a typical real estate transaction. It’s easy to overlook a missing document that ends up being critical to the deal. Plus, the documents need to be verified for accuracy. An incorrect property description or a missing piece of vital information can cause serious complications. Even a misspelling can cause delays because documents need to be reprinted and re-signed.
Faulty disclosures — The seller in a residential real estate transaction must complete a list of disclosures outlining everything they know about the condition of the property. This makes buyers aware of possible defects on the property and any major repairs that have been performed over the years. If the seller gives incomplete or inaccurate disclosures, the buyer is being denied crucial information.
Closing cost details — Parties can negotiate most closing costs, such as escrow fees, notary fees, transfer taxes and inspection costs. The contract should explain exactly who is responsible for paying for all actions required to be taken under the contract.
Unclear seller authority — It’s not uncommon for a home to be put up for sale by an heir or relative of the owner after the owner dies or becomes incapacitated. That person may have a power of attorney but may not have the right to sell the home. Besides a title search, there should be a diligent search of probate records to make certain that the sellers involved are, in fact, authorized to convey title.
Gesmonde, Pietrosimone & Sgrignari, L.L.C. represents buyers and sellers in residential real estate transactions across Connecticut. Our attorneys are available to negotiate, draft or review contracts to make sure your interests are protected. Call 203-745-0942 or contact us online to speak with a real estate lawyer in our Hamden or East Haven offices.
Gesmonde, Pietrosimone & Sgrignari, L.L.C. is located in Hamden, CT and serves clients in and around North Haven, Hamden, Waterbury, Bethany, Milford, Wallingford, Prospect, Woodbridge, Northford, Madison, Beacon Falls, Branford, Cheshire, North Branford, East Haven, Naugatuck, Meriden, Ansonia and New Haven County.
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