Real Estate - Buying a Property
TEN THINGS EVERY BUYER IN NEW JERSEY HAS TO KNOW
To set up a free consultation about buying a house, please call us at (201) 380-1050.
Our real estate representation may include the following:
To set up a free consultation about buying a house, please call us at (201) 380-1050.
The Process of Buying A Home
It is extremely important that a prospective buyer use the greatest caution in buying a home. Likewise, selling a home involves many issues that may not be obvious. A seller has many legal obligations to the buyer and failure to fulfill these obligations can result in years of costly litigation down the road.
The agreement to sell between a real estate buyer and seller is governed by the general principles of contract law. The Statute of Frauds requires that real property contracts must be in writing. Title to real estate must be marketable, which means that it must be free and clear of all encumbrances, liens, clouds, litigation risks, or other title defects. To ensure marketable title, the buyer typically employs an attorney or a title insurance company to perform a title search. In a title search, the searcher examines the public records in the county in which a property is located, mapping a chain of title by examining all the recorded deeds concerning the property. The title searcher will also determine if there are any encumbrances on the property, such as mortgages, unpaid real estate taxes, liens for municipal improvements, unpaid federal taxes, government claims, legal judgments, foreclosures, condemnations, covenants, and easements. A title insurance company will insure the buyer against losses caused by the title being invalid.
All contracts for the sale of 1-4 family residential properties prepared by realtors in the State of New Jersey provide for a 3-business day Attorney Review period. One of the biggest mistakes residential property buyers can make is not asking a qualified attorney to review the contract prior to the conclusion of the Attorney Review period. A party’s ability to make changes to the contract during the Attorney Review period expires 3 business days after the contracts have been signed and received by all parties. During this time, changes can be made to the contract. Once both parties sign off on the changes, Attorney Review ends and the contract is finalized. In most cases I will find ways to modify contracts to better protect the interests of my clients.
There are generally three contingency provisions in the contract that protect the buyer and his/her deposit. These are the home inspection, mortgage commitment and title contingencies. If these contingencies are not satisfied, the buyer can generally cancel the contract and have the deposit returned.
Inspection of the home to be purchased should be scheduled right after the Attorney Review period ends. I suggest that you speak with 2 or 3 inspectors (I can provide a few recommendations), choose one and have the inspection done within the time frame allowed in the contract. This cost will be paid directly by you to the inspector. I personally advise my clients buying or selling homes which repairs to request or to agree to prior to closing. By providing this level of personal attention to your closing, I minimize the possibility of post-closing problems. Knowing that your real estate attorney is guiding you through this complex process and cares about your transaction minimizes the stress associated with real estate closings.
The area of real estate sales has been greatly complicated over the last few years. Environmental issues such as well water testing, oil tank inspection, asbestos and lead paint issues have all become top concerns. Additionally, new issues such as black mold and defective building materials have combined to further complicate the real estate purchase. As these concerns shift over time, New Jersey real estate lawyers must study new statutes, read new case law and take continuing legal education courses to stay current with these ever changing issues. My experience in handling these matters will help to assure the smoothest transaction possible.
My office can go through your inspection report with you step-by-step over the phone. I will then generate a letter to the seller’s side to rectify the inspection issues.
You will also need to obtain financing for your purchase, usually by taking a mortgage loan. I have worked with conventional, adjustable rate, LIBOR mortgages, FHA and VA loans as well as reverse mortgages and second mortgages.
Once the inspection issues are resolved and you have obtained a mortgage commitment, my office will order the title search and survey.
Title insurance will insure that you have clear legal title to the property. It takes my office approximately two weeks to obtain the title search. I will review the title search and then submit it to your mortgage company. The title search and title insurance policy cost is regulated by the State of New Jersey and is based upon the purchase price of the home. This cost will be paid at closing.
Aside from the attorney fee and mortgage costs, you will also incur inspection, title search and insurance, survey, escrows, insurance, recording costs and other costs.
To set up a free consultation about buying a house, please call us at (201) 380-1050.
- Attorney Review Period: This is a three day period in which buyers and sellers can have their contracts reviewed by a real estate attorney in New Jersey. It is important to remember this review period is three business days from the date the last buyer or seller signs, not when the real estate attorney receives the contract.
- Contingencies: This means the contract is contingent or dependent upon something happening first. In New Jersey, it’s customary that all real estate contracts are contingent on the buyers getting their mortgage, home inspections and a clear title.
- Mortgages: A mortgage is a lien put on the property by a lender. There is a great difference between a buyer getting a 90% mortgage from a lender and 80% mortgage from a bank.
- Home Inspection: When we buy a house, there are hundreds of items (often hidden) that can be wrong. Remember, New Jersey has the oldest housing stock in America. If you buy or sell a house in North Jersey, it might be over 50 to 100 years old. Problems with the major systems are often very expensive to fix, particularly with older frame houses.
- “As Is”: This means you only get what’s there, nothing less and nothing more. It produces more real estate litigation than any other clause in a contract, which is why it’s vital to get the help of real estate lawyer in New Jersey if you want to buy a home. A seller has to ensure that the house, the structure, and its operating systems (heat, electrical, plumbing, etc.) are in good operating condition at the closing. Some sellers may also have to make sure appliances, such as a stove or dishwasher, work. However, the sellers do not have to guarantee that the house or the systems are brand new, which is often where problems begin. Buyers don’t want to put thousands of dollars into a new plumbing or heating systems, and seller’s don’t want to pay for improvements they didn’t have at contract time. The New Jersey law doesn’t interpret “as is” to mean buyers get stuck if major systems don’t work. The sellers have an obligation to disclose any hidden defect they know about. Correspondingly, I believe any borrower has an obligation to check out any house by a home inspector before purchasing.
- Closing Date: This is put on at the beginning of a contract and is only a guess at when the closing will take place. The closing date is set by the borrower’s lender and not by the seller or buyer.
- Escrows: Escrow is money held. Lenders will collect extra money each month (escrow) so they will pay your taxes. An escrow is kept at closing in case the water bill comes in higher than estimated.
- What a New Jersey Real Estate Attorney Does: We order title insurance, set closings, tell you how much to bring, work out all problems, supervise, guide you through the whole process, work closely with lenders (who let NJ attorneys close or disburse mortgages) and coordinate with brokers.
- What a New Jersey Real Estate Attorney Doesn’t Do: We don’t arrange homeowners insurance or inspect the house. You make the last minute inspection before the day of closing.
- Legal Fees: Our New Jersey real estate law firm usually estimates $1,600.00 for representing a buyer and $1,400.00 for a seller. Most real estate attorneys in New Jersey are also in this price range. Beware the low ball phone quotes, only to be charged $100.00 for a Notice of Settlement and $100.00 for fax, copies and toll charges. Attorneys can only charge you actual costs incurred. Good New Jersey real estate attorneys don’t tack on extra hidden fees.
To set up a free consultation about buying a house, please call us at (201) 380-1050.
Our real estate representation may include the following:
- Review or prepare contract of sale between buyer and seller
- Interview and counsel client
- Coordinate with lenders, real estate brokers and attorney for opposite party
- Advise client concerning procedures relating to the transaction, including obtaining and discharging mortgages, obtaining insurance, acquiring possession and paying expenses related to closing
- Monitor compliance with contract including obtaining of mortgage by buyer, payment of balance of deposit money, establish closing details and arrangements for possession
- Review title continuation and ascertain the nature of title exceptions, and prepare necessary documents to clear title exceptions. Review current survey for accuracy and encroachments
- Prepare or review closing documents, including the following: deed to real estate (including counsel on proper method of delivering and holding title), affidavit of title, bill of sale of personal property, mortgage documents (for buyer), realty transfer tax, and HUD-1 Settlement Statement
- Attend closing and supervise title procedures and delivery of closing documents, verification of closing figures and compliance with contract, payment of purchase price or delivery of proceeds, delivery of possession, recording of deed and ordering title insurance and payoff of items to be paid from closing proceeds
- Provide advice concerning post-closing procedures and tax aspects of transaction
To set up a free consultation about buying a house, please call us at (201) 380-1050.
The Process of Buying A Home
It is extremely important that a prospective buyer use the greatest caution in buying a home. Likewise, selling a home involves many issues that may not be obvious. A seller has many legal obligations to the buyer and failure to fulfill these obligations can result in years of costly litigation down the road.
The agreement to sell between a real estate buyer and seller is governed by the general principles of contract law. The Statute of Frauds requires that real property contracts must be in writing. Title to real estate must be marketable, which means that it must be free and clear of all encumbrances, liens, clouds, litigation risks, or other title defects. To ensure marketable title, the buyer typically employs an attorney or a title insurance company to perform a title search. In a title search, the searcher examines the public records in the county in which a property is located, mapping a chain of title by examining all the recorded deeds concerning the property. The title searcher will also determine if there are any encumbrances on the property, such as mortgages, unpaid real estate taxes, liens for municipal improvements, unpaid federal taxes, government claims, legal judgments, foreclosures, condemnations, covenants, and easements. A title insurance company will insure the buyer against losses caused by the title being invalid.
All contracts for the sale of 1-4 family residential properties prepared by realtors in the State of New Jersey provide for a 3-business day Attorney Review period. One of the biggest mistakes residential property buyers can make is not asking a qualified attorney to review the contract prior to the conclusion of the Attorney Review period. A party’s ability to make changes to the contract during the Attorney Review period expires 3 business days after the contracts have been signed and received by all parties. During this time, changes can be made to the contract. Once both parties sign off on the changes, Attorney Review ends and the contract is finalized. In most cases I will find ways to modify contracts to better protect the interests of my clients.
There are generally three contingency provisions in the contract that protect the buyer and his/her deposit. These are the home inspection, mortgage commitment and title contingencies. If these contingencies are not satisfied, the buyer can generally cancel the contract and have the deposit returned.
Inspection of the home to be purchased should be scheduled right after the Attorney Review period ends. I suggest that you speak with 2 or 3 inspectors (I can provide a few recommendations), choose one and have the inspection done within the time frame allowed in the contract. This cost will be paid directly by you to the inspector. I personally advise my clients buying or selling homes which repairs to request or to agree to prior to closing. By providing this level of personal attention to your closing, I minimize the possibility of post-closing problems. Knowing that your real estate attorney is guiding you through this complex process and cares about your transaction minimizes the stress associated with real estate closings.
The area of real estate sales has been greatly complicated over the last few years. Environmental issues such as well water testing, oil tank inspection, asbestos and lead paint issues have all become top concerns. Additionally, new issues such as black mold and defective building materials have combined to further complicate the real estate purchase. As these concerns shift over time, New Jersey real estate lawyers must study new statutes, read new case law and take continuing legal education courses to stay current with these ever changing issues. My experience in handling these matters will help to assure the smoothest transaction possible.
My office can go through your inspection report with you step-by-step over the phone. I will then generate a letter to the seller’s side to rectify the inspection issues.
You will also need to obtain financing for your purchase, usually by taking a mortgage loan. I have worked with conventional, adjustable rate, LIBOR mortgages, FHA and VA loans as well as reverse mortgages and second mortgages.
Once the inspection issues are resolved and you have obtained a mortgage commitment, my office will order the title search and survey.
Title insurance will insure that you have clear legal title to the property. It takes my office approximately two weeks to obtain the title search. I will review the title search and then submit it to your mortgage company. The title search and title insurance policy cost is regulated by the State of New Jersey and is based upon the purchase price of the home. This cost will be paid at closing.
Aside from the attorney fee and mortgage costs, you will also incur inspection, title search and insurance, survey, escrows, insurance, recording costs and other costs.
To set up a free consultation about buying a house, please call us at (201) 380-1050.