Outside of jackpot lottery winnings, real estate purchases tend to feature extraordinary numbers, and the application process alone is enough to cause anyone's head to swim in circles. If you're looking to delve into home ownership for the first time or are trying to see if real estate investment is something you'd like to try, assistance from a real estate closing attorney could be the difference between finding the perfect property and falling into a money pit.
Use this essential resource as you start your journey to home ownership and real estate investment. We'll cover how a real estate attorney can help you, how to purchase land, and how to avoid common real estate scams.
There are many ways that a real estate attorney can assist you and provide value. The following are a few areas in which an attorney can help you navigate real estate law:
Real estate attorneys can prepare deeds for the following documents:
- Conveyance transactions
- Rental agreements
- Purchase contracts
- Financing agreements
Only licensed lawyers can actually draft and revise these documents, although state law allows real estate agents to help clients fill out the above documents.
When real estate transactions don't work out, it's common to involve the court in a lawsuit. In these cases, a real estate attorney can assist you in real estate litigation, which includes:
- Drafting legal pleadings to file
- Participating in hearings and trials
- Filing appeals when necessary, such as in cases of property rights
- Bargaining with opposing counsel if a settlement is possible
Clients often ask their real estate lawyer to negotiate the terms and conditions of real estate deals, due to the sophisticated experience real estate lawyers have with many types of real estate transactions. These negotiation skills would have served the above victims well in fending off housing scams!
Sometimes you might opt to negotiate your own deal, sign a contract and then ask your lawyer to essentially perform a final check on the deal. This means the lawyer will examine things such as:
- Legal title issues
- Environmental issues and reports
- Any other contracts or other documents involved in the transaction
- The training that real estate lawyers receive allows them to identify issues that clients might miss. In this role as well, the real estate lawyer acts as a guardian for clients to make sure they don’t fall into any unseen legal traps.
Some attorneys focus on mortgage and trust deed foreclosure, especially in insecure economic times.
- Some lawyers represent lenders, and others choose to represent borrowers.
- Lawyers who work with lenders guide them through the foreclosure process, including the filing of a lawsuit in court.
- Lawyers who represent borrowers oppose the foreclosing lender by challenging any mistakes made in the foreclosure process. They will also negotiate with the lender for a settlement agreement, which ends the foreclosure process.
Many people think that learning how to buy land is fairly simple. The assumption is that you find a lot you like in an appealing location and make an offer. However, there are a few considerations which you'll probably need a bit of assistance with depending on what you are planning on doing with the land you are purchasing.
How To Buy Land: Discovering Restrictions
There are many reasons to work with a real estate attorney during any real estate transaction.
For example, you don't want to run into a legal situation without the support of an attorney when you're planning to buy land to develop. Before you make an offer on any piece of land, you'll definitely want to ensure that all aspects of your building plan are in order.
Buying land is different from buying a house, regardless of the motivation. Things that you never have to worry about in a home purchase, like utilities, access, easements, and land-use restrictions, are typical concerns during a land purchase.
"It can be a complex thought process," according to Stephen Roulac, CEO of the Roulac Group, a real estate consulting firm in San Francisco. "When you buy an existing house, someone has already gone through the issues of what's allowable on the land."
For example, many municipalities have laws and regulations about the development of land:
- You many face restrictions on the size of the structure and it's proximity to the road nearby homes.
- Some land may have environmental restrictions that will affect the type of structure that can be built on the land and where it may be located.
- There will be further guidelines that have to be met depending on the zoning of the land and whether it will be for commercial or residential purposes.
How to Avoid Getting Burned By Restrictions
People learning how to buy land will typically make the assumption that any restrictions on the land must be disclosed by the seller during the real estate transaction. However, this is only true if the seller is aware of them. There may be issues with the land that no one is aware of yet, issues which you need to know before finalizing a purchase.
While speaking directly to town officials and land surveyors will help answer questions about the land, the ultimate protection comes when you hire a real estate attorney. Your attorney can make sure there are no liens on the land and help you determine if any of the above restrictions (and more) apply for development of the land.
Figuring Out the Financing
According to Bankrate.com financing, a land purchase is very different from applying for a mortgage. “Unlike home mortgages, where competition is fierce, financing for unimproved property is an intensely local marketplace.” This means that since major banks are not big players in this market, seeking out a community bank is typically your best bet.
When you're looking for the perfect house, the search might feel like the hardest part of the process until you realize you have to make an offer, get a mortgage, deal with title issues, and get the whole thing wrapped up with a half-dozen signatures and agreements.
You've got several options that may help you experiences as few unexpected hassles as possible, and you'll want to employ these tips from the moment you start looking for a new home investment property.
Ask Questions. One of the biggest problems people have when they go to the doctor is that they don't ask questions when they're confused about a diagnosis, symptoms, or something health-related. The same problem occurs in real estate closings.
Your real estate closing attorney will help as much as possible to answer your questions and ask questions of the right parties, but don't stay silent and assume that all your questions will get answered. Always speak up if something seems confusing or whenever you need clarification.
Consider a Day Off. You've probably got a busy job, kids, and a life to lead, but when you're trying to complete a real estate transaction, you've got to put in the time and effort to understand the process and make sure you've got all the required paperwork, identification, and other documents required of the process. Think about taking a day off – or at least a few hours – to devote your full attention to the day of closing.
According to Bankrate:
A smooth closing may take less than 30 minutes. You won't know for sure if your closing will go as planned until it's done.
One of the best reasons to have a lawyer working for you during the closing process is that you reduce the likelihood of a problem occurring at the last minute. Real estate lawyers deal with common issues every day, and very rarely does anything take a professional by surprise. They've seen it all and know how to get past problems without days or weeks of delays that could put a closing in jeopardy.
Expect the Unexpected. Did you know that a mistake as innocent as a typo could put a wrench in your closing? A typo that spells a name wrong or puts a decimal point in the wrong place could mean all the calculations done to come to an agreement are invalid. Documents prepared by another party need to be checked multiple times to make sure no errors exist. Consider the hassle if a typo made its way into the paperwork and impacted the cost of the investment down the road.
Handling the Walk-Through
You'll need to perform a walk-through a day before the final closing date to make sure that everything that was true when you first saw the property remains true at the time of closing. Sometimes your closing depends upon the seller completing certain repairs to the house. The walk-through is when you want to make sure that agreed-upon changes have been performed.
You should also see that the house has been cleaned appropriately and that a bunch of trash and dirt hasn't been left behind. Make sure a mountain of garbage hasn't been left at the curb. Sometimes the city will charge you to pick up a large amount of trash or big items that won't otherwise fit inside a regular trash can.
According to HomeFinder, other items you'll want to look for during the walk-through include:
During the walk-through, you should also find the manuals for appliances, furnace and air-conditioner. If the home you’re buying has automatic-garage-door openers, they should be left out for you to test. Run any appliances, hot and cold water, and flush the toilets to make sure they are working properly. If there are problems, or it appears that the owners can’t vacate the home and deliver it to you at closing, tell your real estate agent or attorney.
If repairs haven't been completed or if something was left behind unexpectedly, don't panic. Your lawyer should be able to negotiate a solution on the day of closing to avoid any lengthy delays associated with the final transaction.
Real estate scams have become commonplace as homeowners trying to avoid foreclosure search for ways out of their financial issues. Especially prevalent today are real estate scams which target homeowners who are seeking mortgage relief. A recent Fox Business article highlights how anxious homeowners have become a prime target of con artists who prey on vulnerable people.
With the federal government offering a variety of mortgage relief programs, scammers have found ways to turn incomplete consumer knowledge about these programs into scam profit. Here are some examples of common mortgage relief real estate scams.
Real estate scammers posing as official counselors:
One such scam involves people posing as nonprofit housing counselors and other mortgage-industry participants. These scammers claim to be connected with the homeowners' lenders or said homeowners had already been approved for a loan modification under the Home Affordable Modification Program (HAMP). They typically will demand an upfront fee for their services.
To avoid being caught by one of these scams, homeowners should find a legitimate, free Housing and Urban Development (HUD) approved housing counselor by going to HUD.gov.
Offering to perform a mortgage audit:
This scam seeks to charge homeowners for a "forensic loan audit." The real estate scam works like this: A salesperson would call the homeowners and say they were going to audit their mortgage documents and use the violations they could find to force their lender to approve a loan modification. Then the scammers would tell people that they found violations and ask for a $1,000 to $5,000 fee from the homeowners.
Paperwork for a loan audit can look legitimate, but consumers can avoid scams by proactively contacting a local HUD-approved housing counselor through the HUD website.
These scams will often guarantee a loan modification under the HAMP. This scam involves counseling homeowners to stop making their mortgage payments and to avoid contact with their lenders. While many scammers guarantee a loan modification or guarantee that they can stop a foreclosure, it is critical to understand that it is impossible to guarantee a loan modification.
An additional issue with this scam is that homeowners might have been able to modify their mortgages under HAMP if they had not become so far behind on the mortgage by following a real estate scammer’s advice.
You should never pay a fee for loan modification assistance. Government and nonprofit housing counselors will provide this service for free.
Advising you to stop contacting your lender:
Some scams not only charge upfront fees in exchange for loan modification assistance, they may also counsel you to reject your lender's offer of a loan modification.
It is critical to be wary of anyone who tells you to stop paying your lender or who tells you to stop trying to contact your lender.
Victim Of A Housing Scam? A Real Estate Attorney Can Assist You
Most of us have been subject to a housing scam at some point in our adult lives. Most of the time we recognize them as a scam, but not always! In some cases, it can be very helpful to have a qualified real estate attorney, who can assist you with any potential detrimental real estate transactions.
The value of a real estate attorney is displayed in a recent Dayton article that highlights a case in which a sophisticated 5-year housing scam was finally uncovered after the alleged conspirators targeted elderly individuals and stole millions.
According to the article, “The alleged scammers would call owners of mostly undeveloped land across the country and ask them for closing costs on the front end, telling them that their properties would be sold for up to 15 times its worth.”
The ‘big fish’ in the ring is Roger Van Doren, who has been charged with “..engaging in a pattern of corrupt activities, conspiracy, aggravated theft of $1.5 million or more, telecommunications fraud and money laundering.”
If the victims of these crimes had turned to an experienced real estate lawyer, the chances are very slim that they would have been duped out of their property and earnings. Property law can be complex for those who do not fully understand the system, and it could be easy for someone with better knowledge to pull the wool over your eyes! In this scenario, an attorney can assist you in a security capacity, protecting you, your earnings, and your property from malicious individuals.
Get Help From a Real Estate Closing Attorney
If real estate closing seems like a complex process wrought with potential failure and stress, you're right to think that it can be a long process that takes weeks of nail-biting to accomplish. However, the complexity of real estate closings and the legal ramifications of buying a home mean that a real estate closing attorney is your best ally for successfully closing on the home of your dreams.
Whether you've got your eye on the perfect home for your family or you're looking at a great piece of land for your custom house, Chang & Carlin, LLP can help you. Request a Free, No Obligation Legal Consultation today!
DISCLAIMER: All information on this website is provided for informational purposes only and not intended to be construed as legal advice. Suburban Legal Group PC shall not be liable for any errors or inaccuracies contained herein, or any actions taken in reliance thereon.