Real estate transactions often involve high stakes for all parties part of the deal, and the process can be complex and full of potential pitfalls. If you are a home buyer or seller, a residence involves a significant financial commitment, and your home can represent a high proportion of your net worth. If you are in a commercial real estate transaction, the terms of the deal for its entire term are binding. When it comes to buying or selling commercial property, it often involves a large amount of money. You will have rights and obligations during a lease transaction, depending on the contract you signed.
There may be several legal issues in your real estate transaction that you may be unable to anticipate on your own. If problems arise in the future, they can surprise you when you have little to no legal protection.
You should only engage in transactions with the help of a real estate attorney. A real estate attorney is a legal professional with experience in property law, and their involvement can provide invaluable guidance and protection throughout the entire process. Contracts govern every deal and must be in writing (under the statute of frauds, there is no such thing as an oral contract for the sale of real estate). This document will contain your legal rights and obligations.
If you are thinking about a future transaction, you should contact a Board Certified Real Estate Attorney now to learn what factors you may need to consider. If you are a residential home buyer, contact a real estate attorney as soon as possible, especially after agreeing to purchase a property.
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You Need Help with the Transaction
Real estate deals may require extensive negotiation, depending on their complexity. Even if you are buying or selling a home, you and the other party will have a legal relationship, and if something goes wrong with the deal, one party may owe the other a substantial amount.
First, you may need help negotiating the actual terms of the deal. A real estate attorney can tell you what you need to know and what steps to take to protect yourself. They can even engage with the other party's real estate lawyer to negotiate on your behalf. You may not need this help in a residential real estate transaction, but you do require this assistance in a commercial real estate deal.
Second, you will undoubtedly need the help of a real estate lawyer to review and even draft the contract itself. Each word and comma in a real estate contract is critical, and you can experience unfavorable effects if you do not closely review the agreement's language before you sign it. Once you sign a contract, its terms bind you, and you can be liable for a breach of contract.
Real Estate Documents Are Critical Transactions
Even if you are engaging in a residential real estate transaction, no "standard" contract governs your deal. While you may start with a template contract, there may be custom terms for your situation. A real estate lawyer will review your agreement and advise you on what additional terms you may need to protect you or how you should modify what is already in the contract. If the other party tries to add their terms to the deal, a real estate attorney can review their proposal and change the language.
Every contract is critical, but commercial real estate deals can be even more complex and require even more negotiation ahead of time.
If you are negotiating a commercial lease, you may need to discuss the following:
- Who is responsible for paying the utilities?
- Which party must perform the maintenance on the property?
- How may the rent escalate over time?
- Is there a lease-to-own option?
- Are there options to extend the lease?
- What happens if one party violates the lease?
Whether you are the lessor or lessee, you will certainly need the help of a real estate attorney before you negotiate a lease.
Potential Legal Complexities in Real Estate Transactions
Commercial real estate purchases and sales are also highly complex. There may be issues that arise, including:
- Disclosures of any known issues relating to the property
- Zoning approval for use of the land
- Due diligence that the buyer will perform on the property before the deal
- The terms of financing for the deal and what happens should the buyer be unable to obtain financing
- Any covenants or restrictions on the usage of the property
- Inspections of the property before the deal closes
A real estate lawyer can negotiate these issues because there can be challenges that are unique to your deal. They can also help draft contract language that addresses these situations.
There May Be Issues After a Transaction
The hope is that your real estate transaction has gone smoothly and there will be no issues in the future. However, there may be legal situations that you need to deal with when there is a problem with the transaction, and there is always the potential for litigation. You may believe the other party failed to disclose something when you bought or leased the property. Alternatively, the other party may accuse you of not disclosing all the details yourself. Either way, there can be a dispute that needs a resolution.
Some examples of post-transaction legal issues that may require the help of a real estate lawyer include:
- One party to a transaction failed to disclose the existence of an easement to the other
- The buyer of a transaction realizes that the title to the property is not free of defects
- There are defects in the structure itself that one party failed to disclose to the other at the time of the transaction
- There are disputes over the terms of the contract
A real estate attorney can provide legal advice and guidance if any problems arise with the property after the transaction. They have the experience to navigate these complex matters and protect your interests.
Real Estate Litigation Can Be Both Costly and Risky
Remember that every real estate transaction involves a binding contract, and each party has to act in good faith. They also have a duty to make full disclosures to the other party. In the event of a dispute about the terms of a contract, a court will look to the exact language of the agreement and will not look to any external evidence if the language of the contract is sufficiently clear.
When a transaction goes wrong, litigation may ensue. One party may try to walk away from the agreement after signing a contract because they may have learned that the property is not what the other party led them to believe when negotiating the transaction. Alternatively, the financing for the deal may have fallen through, and the buyer may be unable to complete the transaction.
If a party files a real estate transaction lawsuit, they may be seeking the following:
- Monetary damages for any financial harm that the party suffered, including for a failure to disclose defects and any reliance damages
- Specific performance, ordering a party to take certain actions to complete the deal (usually when one party is trying to back out of the transaction)
- Rescission, seeking to undo the agreement entirely when there has been fraud in the inducement of a transaction
- Injunction, ordering a party to undertake a specific action or refrain from engaging in it
A skilled lawyer can explain your rights and responsibilities, evaluate the strength of your case, and develop solid legal strategies to protect your interests. They can also assist in negotiating settlements and represent you in court if needed. With their experience and knowledge of real estate laws, they can protect your rights and ensure you achieve the best possible outcome in your transaction litigation case.
Real Estate Lawyers Save You Time
Regardless of the type of transaction you are engaging in, real estate deals can be time-consuming. Reviewing a contract can take dozens of hours, and you may not even know what you are doing. Real estate attorneys know how to perform these tasks.
If you are buying or selling a residential real estate property, you are dealing with many other details. You may be looking ahead to when you need to relocate or deal with other changes in your life, and you may not have the time to engage in the transaction details. Often, you are more focused on finding the right home or ensuring you get the most possible money for a property you are selling.
Time is a challenge in commercial real estate transactions, mainly when you are focusing on running a business and may have little time to investigate the details. A real estate lawyer can handle these details far more efficiently, freeing you up to spend time on revenue-producing aspects of your business. You can get much more peace of mind when you hire an experienced real estate attorney to advise you every step of the way.
A Real Estate Lawyer Helps You Anticipate Other Legal Issues
Other challenges may arise as part of the transaction. For example, you may need permits or approvals from a government entity before a deal can proceed. You may also need zoning approvals or a variance to use the property in a certain way.
You can also have legal issues surrounding environmental regulations that you must comply with as the property owner. These regulations can restrict your use of the property or impose additional obligations and responsibilities that can raise your cost of ownership.
A real estate lawyer can comprehensively review regulations and other legal issues to anticipate challenges that may arise with a transaction. They can then suggest and draft contract changes that provide additional protections if certain contingencies occur.
You may also need the help of a real estate lawyer at various other points in your relationship with another party where you may have a dispute or need to modify an existing contract. Some situations may require getting legal advice so you know your rights. Learning as much as possible is always better so you are not dealing with "unknown unknowns." Real estate lawyers can inform you about what you need to know, so there is less that can take you by surprise.
Spending Money Now Can Help Save You Money in the Future
Hiring a real estate lawyer is an investment for your future. If you do not hire a real estate lawyer for a potentially complex legal issue, it can cost you far more money when things go wrong. You may end up with financial losses that you may have prevented if you spoke with an attorney earlier. You may not have a solid legal case because the language of a contract does not protect you, or you may even end up liable for damages for something you did not anticipate.
It always helps to speak with a real estate attorney to find out how they can help you. An attorney will review your situation and explain some of the issues that you may face. Regardless of whether you hire a real estate lawyer, you should know what may lie ahead for you. You may realize that you need the services of a real estate attorney to help prevent you from having legal problems later.
If you have yet to contact a real estate lawyer about your legal issue or potential transaction, now will be the time to do so. A real estate attorney can review your situation during your initial consultation and explain what you may need to consider and how the law may affect you.
Having a Board Certified Real Estate Attorney by your side is crucial when navigating the complex world of property transactions. Their experience is invaluable, from reviewing legal documents to avoiding costly mistakes and negotiating the best terms. So, before you embark on your next real estate transaction, consider the benefits of having a trusted attorney by your side to ensure a smooth and successful experience.