Whether you’re buying your first home or expanding an existing property portfolio, real estate purchases have a lot riding on a successful transaction. One important misstep can cost you even more money to fix. This fact alone makes attorney involvement strongly advisable but some buyers, aware of the fact that hiring a real estate attorney is not legally required, try to cut costs by handling the entire process themselves. Unfortunately, a penny saved can turn into dollars lost. Here are four reasons why.
There Are Contracts to Review
While real estate purchases may begin with face-to-face negotiations, they have to be formalized in a contract to be legally binding. An attorney will ensure that the contract complies with all applicable state laws and covers any situations that may impact the way you use the property in the future. When you or the seller are operating as a trust, corporation, or partnership, legal counsel becomes even more important, as the sales contract must be compliant with both the law and the trust, corporation, or partnership’s charter agreement.
There May Be Liens
An attorney will perform a title search to ensure that the property you want to buy is free of encumbrances such as judgments or liens, which will interfere with the seller’s legal right to sell it to you. If such an obstacle is found, an attorney can address the problem by suggesting ways the seller can satisfy the claim, and obtain proof that the judgment or lien has been satisfied. This is especially important if you want to obtain a loan or mortgage against the value of the home later on.
One example of how a title search and report is important is we had a client who wanted to build a six (6) story building on land. When we ran the title search, we discovered a restriction on the property limiting any new buildings to two (2) stories. The seller knew this and had this fact from our client, but a title search provided us with the information to terminate a contract.
There May Be Construction Prohibitions
If you are purchasing the land to build on, there may be state regulations prohibiting that type of construction on that property. Not only can an attorney save you time and money by discovering this complication in advance, they can also advise you on what building permits must be filed if you intend to build on areas like wetlands.
There May Be Business-Related Complications
If you are purchasing a piece of real estate for commercial reasons and your business is not properly registered with the state, you may not receive your company’s taxpayer identification number, forcing the business to shut down until that information is secured. An attorney who is experienced in real estate transactions would be on the alert for such problems and help you get the required documentation.
Due to the complexities inherent in a real estate transaction, retaining legal counsel simply makes good business sense. If you are planning to purchase land or property in New York state or Florida, call Rosen Law today for a consultation. We will help you protect your interests at each stage of the process and ensure that the entire transaction complies with all applicable state and / or municipality rules, so that you can benefit from your purchase without worrying about future problems and unexpected liabilities.