RESIDENTIAL REAL ESTATE
Also see Residential Real Estate, Your Attorney, Your Realtor, Your Lender, Your Title Insurer.
The
two most important truisms of a real estate transaction are: “It doesn’t count unless it’s in writing” and “the deal’s not done
‘til the money crosses the table”. These are truisms - because they are true.
A Contract Must Be in Writing
There
may have been days when a man’s word was his surety, when a handshake was enough to seal the deal. If there ever were such days
- they are no more. The Statute of Frauds (enacted in
The start
of any real estate transaction is the contract. This is the document that sets forth all the necessary provisions of the agreement
to buy or sell. An attorney could draft a wholly new contract for each buyer or seller, but that would be unworkable for a couple
of reasons: the cost of the drafting of the contract would be prohibitive to the client, and it would be prohibitive to the
other party, whose attorney would have to slog through every sentence of the contract to make sure that it contained everything that
it needs to. The solution is a standardized contract, a form that all the attorneys, real estate professionals, financial institutions
and others are familiar with.
Can a Contract be Amended Once It Has Been Signed?
In
Once a contract is filled
in, the buyer signs it and presents it to the seller as the buyer’s offer. The seller then may consider the contract, showing
his acceptance by signing it and returning a copy of it to the buyer. But remember – the corollary to “It doesn’t count unless
it’s in writing” is “But once it’s signed, it’s carved in stone.” Tradititonally, buyers’ took contracts to their attorney for
review before presenting it to the sellers. However, the latest version of our contract form provides that even after buyers
and sellers have signed the contract, both the buyer’s and seller’s attorneys have time to review the contract and either approve
it, reject it, or propose modifications. This allows the buyer and seller to first secure a contract before incurring costs
by seeing an attorney. But be careful about signing a contract; make sure that it has such an attorney review provision in it
before you sign.
What Happens After the Contract Is Signed?
The contract sets forth both the buyers’ and the sellers’
responsibilities for the transaction. In most cases, the buyer must work toward obtaining a mortgage or selling his residence.
The seller begins gathering the documents he needs (title insurance, well and septic report, survey, condo dues letter, etc.)
and drafting the documents necessary to transfer title (deed, bill of sale, affidavit of title, etc.). And hopefully, by the
closing date, both buyers and sellers will be ready.
But having a successful closing doesn’t happen by magic. In my experience,
few buyers know everything they have to do before the closing, and at the closing they are unable to determine for themselves the
legal sufficiency of the documents they are being tendered. And I’ve never met an individual seller not an attorney, who knew
what and how to prepare the documents necessary to successfully close the transaction. Though in many areas of life common sense
is enough to get by, I don’t believe that applies very well to real estate. You have so much at stake, and a small mistake can
be quite costly. I think acting as your own attorney is an example of “penny wise, pound foolish”.
Who Are The Players in a Residential
Real Estate Closing?
The most important players in a real estate transaction are the buyers and sellers, of course. Other
important people are the attorneys, realtors, lenders and title insurance companies. Click on their link to find out how each
of them helps you.
Please call me 815-459-2253 or email me scottnolan@attorneynolan.com for an appointment so we can discuss your closing.