Real Estate Transactions
Numerous legal issues may come up during a real estate transaction in New York. It is often important to consult an experienced attorney when buying or selling real estate. Rockland County real estate transaction lawyer Peter Klose can handle purchase and sale agreements involving the purchase of a home, a vacation home, or a second home. He can guide you through real estate purchase contracts and contract negotiations. He also can assist with residential and commercial real estate closings, closings associated with mortgage refinancing, and insurance coverage issues, among others. Knowledgeable representation during a transaction can help avert costly litigation down the road.Understanding the Complexities of Real Estate Transactions
It is customary in New York for the attorney for the seller to prepare the first draft of the Purchase and Sale Contract of sale. Most sellers’ attorneys start with a standardized form that is circulated by a large title company, or the local bar association, and add a rider with additional terms to be negotiated with the buyers. Depending upon the specific ins and outs of the transaction, we will likely also suggest an additional rider to the contract with terms to be negotiated with the sellers.
Once the attorneys have finalized the contract, they buyers will generally execute the contract and then the sellers, and we will arrange how to deliver to the sellers’ attorney a downpayment. The Purchase and Sale Agreement provides the outline and specific terms and details as to whether you might lose the deposit if you walk away from the deal without a reason contemplated by the contract. Typically, in New York State, the downpayment is for 10% of the purchase price, and the sellers’ attorney will deposit this amount into an escrow account to be paid to the Seller’s “order” at Closing.
New York requires buyers to have a lawyer when purchasing a house. The lawyer should make sure that good and marketable title is being conveyed by the sellers, prepare all of the closing documents, calculate how much money will be owed at closing, ensure that mortgage documents are correct, determine good-faith estimates of closing costs and escrow, and work to resolve any issues with title, such as encumbrances or liens. Failing to hire an experienced and knowledgeable attorney may make it more likely that real estate litigation will occur down the road.
Under New York Real Property Law, Section 462 (“Property Condition Disclosure Statement”), most sellers must make certain disclosures to a buyer of most types of residential property on a disclosure form. Items to be disclosed include any material defects, asbestos or termites existing in the structure, HOA rules, and other facts that could affect the buyer's use of the property. If a home is built before 1978, the seller needs to comply with Title X disclosures about lead-based paint and dangers. Sellers that do not provide the appropriate disclosure form are supposed to credit a buyer $500 at closing. Under NYS RPL § 463 (Exemptions) certain properties are exempt from the disclosure requirements. A real estate transaction attorney in Rockland County can advise you on whether the requirements are likely to apply.
In practice, sellers are meant to provide the buyer a completed the Property Disclosure Form with a copy of the proposed contract for sale, however, the form is not a substitute for homebuyers hiring an independent home inspector to determine whether the home has any problems. The offer can include as a contingency a satisfactory inspection report that indicates that there are no material defects or other problems with the foundation, structure, and major systems, such as plumbing and electrical systems.
Purchase agreements are binding legal instruments that include all of the material terms and conditions of a real estate transaction. In New York, this agreement must be in writing and signed by both the buyer and the seller. It should include all of the financial terms, such as the sale price, who pays for closing and settlement costs, and what the down payment will be.
In addition to hiring an inspector to perform an inspection of major systems, a buyer must also run a title search. A title search looks through publicly available information and other sources to determine whether there are any easements, encumbrances, liens, or other restrictions that could affect the enjoyment and use of the property. Once a title search is conducted, it may be possible for the buyer to secure title insurance to protect their ownership against adverse claims by third parties. Often, lenders require buyers to buy a title insurance policy when securing a mortgage.
Commercial real estate buyers should also ensure that the property is properly zoned for the type of business that they intend to conduct in the building. Zoning regulations can be complex in New York, and a failure to abide by zoning rules or a failure to obtain permission to deviate can result in significant penalties. In some cases, it is possible to pursue a change in zoning to meet business needs and ensure compliance with land use rules, but it is important to retain a knowledgeable Rockland County real estate transaction attorney to this end.
It can take 7-10 days to prepare and negotiate a contract for the parties to sign, and then it takes another month to 45 days for the buyer to secure a mortgage commitment from the lender. Once any contingencies have been met, it can take the lender up to another month to issue a clear to close. Unexpected issues can arise during closing, and it is helpful to have an experienced attorney to handle these problems as they arise.Seek Assistance from a Real Estate Transaction Lawyer in Rockland County
Klose & Associates represents clients in connection with property transactions in Rockland County and surrounding communities. Mr. Klose is a member of the Village of Nyack Planning Board, which allows him to keep abreast of new developments in the law that may affect zoning and land use. We represent clients in cities such as White Plains, Yonkers, Mount Vernon, New Rochelle, Peekskill, Rye, Nyack, Ramapo, Orangetown, Hempstead, Stony Point, Spring Valley, and New City. Call us at (845) 727-7727 or contact us online. Peter Klose also represents people who need a business attorney to protect their interests.