Common Legal Misconceptions: Real Estate
There are a handful of common misconceptions regarding real estate. Unfortunately, the result of these misconceptions is hardly ever benign — it is important to have the facts in order to avoid problems.
- Same-Day Sale & Purchase
People are often under the impression that the sale and purchase of homes can be coordinated so that the transition is seamless (occurs in one day). The coordination of schedules between the moving parties, banks, lawyers, moving companies, etc., requires flexibility in the closing dates on each transaction.
For example, sometimes the seller may stay over (post-closing possession) for 3-7 days in the home in order to coordinate the purchase of the next house and physically move there. This arrangement usually involves having to hold an escrow due to adjustments in real estate taxes, utilities, damage from moving, etc. based on the date that the seller moves rather than the closing date.
- Low Attorney’s Fee = Best Bargain
There are some attorneys who do high volumes of closings. As such, their advertised transaction fee is flat and low. However, the attorney may not provide all of the services included in a higher quote. They may also be generating fees reaping commission from title or lending services, which may not be in your best interests.
It is highly beneficial to find out what is specifically covered by the fee and read the retainer to make sure you are comparing “apples to apples.”
- A Previous Purchase of your Home Means Everything about the Home Is Legitimate and Legal
People assume that if they were able to close on a property, everything about the property must be legal, but that is not always the case. If the bank or the attorneys missed something problematic, the purchaser may have trouble selling down the line, even though he was able to purchase it without an issue.
For example, a previous owner may have converted a garage into a living space. The footprint of the house has not changed, so unless the purchaser, their attorney or the lender’s attorney requests the certificate of occupancy for it, then it may slip through the cracks. It is the certificate of occupancy that makes the conversion legitimate — not the fact that it was already there when originally purchased.
Understanding how real estate transactions unfold will help you be more prepared. Contact us today with your questions.
James F. Leonick
Leonick Law, P.L.L.C.
TEL: (631) 486-9500