Buying a home is normally the largest purchase an individual will make, and as such can be one of life’s most important purchases. Naturally, you will have questions and concerns about the process, the documents involved and whether you are making the right move at the right time. Below is some helpful information to familiarize you with the process. For further information and explanations, please contact us.
Real Estate Facts for Buyers: Preparation is the key for a successful home purchase. Below is some helpful information on specific tasks we take on to facilitate the process, as well as terms that you will encounter to take some of the mystery out of your purchase. For further explanation of these terms or additional information, please contact us.
The Function of a Real Estate Attorney
The attorney that you choose to represent you for the negotiation of the purchase of your home is one of the most important decisions you will make in the Home Buying Process. While your real estate salesperson or broker will work with you to make a decision on which home may satisfy your particular needs, your attorney is the only party who will be working solely for your benefit during the Home Buying Process.
In representing a prospective Purchaser, an attorney performs the following functions:
a) Reviews and negotiates the Contract of Sale; b) Oversees the process of your home purchase; c) Reviews the Title Search; and d) Coordinates the closing of title and the mortgage loan with your lender.
Ideally, an attorney should be retained BEFORE an offer is made to purchase a home. As a practical matter though, most purchasers looking at homes are concerned with the non-legal aspects of selecting a home, such as location, size, type and amenities, and delay the selection of an attorney until after a home is selected and a basic agreement is reached on the price and other general terms.
IF YOU CHOOSE TO FOLLOW THIS TRADITIONAL APPROACH AND HAVE AN OFFER ACCEPTED, DO NOT ATTEMPT TO GO ANY FURTHER WITHOUT CONSULTING AN ATTORNEY.
THE HOME BUYING PROCESS
Before you take the plunge, you should be aware of what you will be encountering during the coming months.
Once accepted by the Seller, a Binder has been interpreted to be a formal agreement. A Purchaser can risk the loss of their earnest money deposit if provisions are not made for a ‘change of heart.’
A Binder should be used by a Purchaser only as ‘an agreement to agree.’ It should always be subject to review by an attorney and the execution of a formal contract containing the basic terms of the offer. In addition, if the offer is being made on an existing home, the binder should also be subject to a satisfactory inspection of the dwelling by a licensed home inspector or engineer.
The potential Purchaser of real estate should have a licensed, qualified home inspector or engineer inspect the property that he is considering purchasing. The right inspector will give the Purchaser a professional opinion as to the current condition of the property, its many systems (such as heating, electrical, plumbing, air conditioning and the roof) and will give his opinion as to what repairs, modifications or upgrades may be necessary immediately or in the near future, and at what expected cost.
A basic real estate contract contains the essential terms of the transaction, names of the parties, purchase price, terms of financing the purchase, the personal property to be included in the sale, and the approximate closing date.
Although it is customary for a Purchaser to be required to deposit up to ten (10%) percent of the purchase price, in escrow, with Seller’’s attorney, this contract down payment can be negotiated between the parties on a case by case basis.
In addition, the contract should contain certain key contingencies: to be negotiated between the Purchaser's and Seller;s Attorney.
Please be reminded that each property is unique and each contract has its own characteristics and problems, which may be encountered. A good real estate attorney will assist you in avoiding the pitfalls that may arise so that your transaction will proceed smoothly from begining to end.
Closing costs are those expenses associated with the purchase of a property other than the contract down payment. Closing costs fall into two major categories: Bank Related Expenses and Title Related Expenses. Bank Related Expenses include Points, Lender’s Attorney fee and costs, Tax Escrow, Private Mortgage Insurance (PMI), Homeowners Insurance and Misc. Fees. TITLE RELATED EXPENSES include Title Insurance premiums, Departmental Searches, Mortgage Recording Tax (MRT and other Recording fees.
Another closing cost not outlined above is the Purchaser attorney’’s fee. While attorney fees vary, a reasonable fee charged by a skilled real estate attorney is always a wise investment.
Mr. Hochman is well versed in the laws and regulations governing real estate transactions in the State of New York, and his advice can help ease concerns associated with real estate transactions in the New York Metropolitan area, including Long Island and Westchester. Our office is located in Nassau county. For the convenience of our clients we are available for weekend and evening appointments at our Syosset office.