Residential & Commercial Real Estate Transactions
Purchasing property—whether for your permanent residence or for commercial and business reasons—can be overwhelming. For those unfamiliar with the process, there are many legal issues that may arise during a real estate transaction in New York and New Jersey. It is imperative for any potential purchasers, sellers, or investors of real estate to consult an experienced attorney from the Law Office of Michael L. Billera and Associates, PLLC to guide them through the process.
Understanding Real Estate Transactions
In New York, the seller’s attorney tends to prepare the first draft of the Contract of Sale. The seller’s attorney will present the draft to the purchaser’s attorney for review and comments. The purchaser will generally include a rider agreement—an addendum to the Contract of Sale—for the seller’s review as well. A contract is required in all agreements to purchase real estate. These contracts are binding instruments that should include the terms of the transaction and condition of the premises.
When the attorneys have agreed to terms, the purchasers will execute the contract and send to the seller’s attorney. The purchasers will generally include the contract deposit or down payment. This tends to be approximately 10 percent of the purchase price—but this is negotiable. Generally, Seller’s attorney will cash the contract deposit or down payment and it will remain in the attorney’s escrow account until the day of closing.
Once the contract is signed by all parties, the purchaser’s attorney will order a title search with a duly licensed New York State title company. By using all available information on the property, the search will determine if there any easements, encumbrances, liens, or restrictions that could affect the purchaser’s use of the property. In short, a title company will ensure that the sellers can actually sell the property to the purchaser. Lenders tend to require purchasers to conduct a thorough title search and purchase a title insurance policy when securing a mortgage. As the seller and purchaser ensure that title is cleared, it is the purchaser’s role to secure a mortgage commitment from a lender.
Commercial real estate purchasers must ensure the property is properly zoned for the type of business that the purchaser wants to conduct. Zoning regulations are complex and failing to abide by regulations can result in penalties for the purchaser. It is is very important for a purchaser to discuss their goals with an experienced attorney from the Law Office of Michael L. Billera and Associates, PLLC.
In New Jersey, the real estate agents tend to prepare a standardized contract of sale. During this process, the purchaser and seller will sign this agreement prior to its presentation to the attorneys. Once the New Jersey contract is signed, the seller’s attorney and purchaser’s attorney will begin the Attorney Review period. The lawyers may draft disapproval letters regarding the original contract. It is in these attorney review letters that the amendments to the contract of sale are formed. These attorney review letters will become legally binding once expressly agreed by all parties. The purchaser will then conduct an inspection of the premises to and renegotiate—in good faith—further terms to ensure repairs or concession to the property. As this occurs—like in New York—the attorneys will ensure title is clear.
The experienced attorneys from the Law Office of Michael L. Billera and Associates, PLLC can guide both purchasers and sellers through this complex process. Please do not hesitate to call or email if you have any questions.
