What is a deed?
A deed is the document that transfers ownership of real estate. It contains the names of the old and new owners and a legal description of the property, and is signed by the person transferring the property.
Do I need a deed to transfer property?
Almost always. You cannot transfer real estate without having something in writing. In some situations, a document other than a deed is used -- for example, in a divorce, a court order may transfer real estate from the couple to just one of them.
Do I need a lawyer when I buy or sell a house?
Buying a home will probably be the largest and most significant purchase you will make in your life. It also involves the law of real property, which is unique and raises special issues of practice, and problems not present in other transactions. A real estate lawyer is trained to deal with these problems and has the most experience to deal with them.
In the typical home purchase, the seller enters into a brokerage contract with a real estate agent, usually in writing. When the broker finds a potential buyer, negotiations are conducted through the broker, who most often acts as an intermediary. Once an informal agreement is reached, buyer and seller enter into a formal written contract for the sale (the purchase agreement). The buyer then obtains a commitment for financing. Title is searched to satisfy the lender and the buyer. Finally, the property is transferred from the seller to the buyer, and the seller receives the purchase price bargained for in the contract.
This seems simple, but without a lawyer, the consequences may be more disastrous than purchasing a car that turns out to be a lemon, or a stock investment that was unwise. A lawyer can help you avoid some common problems with a home purchase or sale.
For example, a seller may sign a brokerage agreement that does not deal with a number of legal problems. This happens quite often; realtors often use standard forms, expecting that they will cover all circumstances or will be easily customizable for unusual circumstances. In the absence of an agreement to the contrary, the seller may become liable to pay a brokerage commission even if a sale does not occur, or to pay more than one brokerage commission. If the agreement allows the seller the right to negotiate on his or her own behalf, for example, you may avoid this problem. A lawyer can explain the effect of multiple listings. He or she can negotiate the realtor's rights if the seller withdraws the property from the market, or cannot deliver good marketable title.
How can an attorney help in a commercial real estate purchase?
When you are purchasing commercial real estate, your attorney plays an invaluable role in protecting your and your business' interests. Below are a number of tasks you should expect your lawyer to complete during the transaction.
- Guiding you through the process. Now that you found a commercial property for your business, how do you go about actually buying it? Your attorney will lead you through what to do and when, and advise you on key points throughout. Some of these include reviewing the purchase agreement, assisting in negotiation for the sale and attending the closing on the property.
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Drafting or reviewing the purchase agreement. Either party's attorney can draft the purchase agreement; sometimes it can be advantageous (though more expensive) for your attorney to do so. The purchase agreement is a formal written contract for the sale, and is the most important document in the transaction. It will dictate all the terms of the sale, including contingencies that will allow you to withdraw from the sale if important events-like your receiving financing-do not occur. If the other party's attorney drafts the purchase agreement, your attorney can review it for completeness and accuracy in reflecting the parties' understanding. He or she can also explain any terms you are unclear about, and advise you if you should sign the agreement or return to the negotiating table.
- Reviewing loan documents. An attorney can help you make sense of the various financing options available, and the tax and other consequences to you and your business. He should assist you in navigating through the complexities of mortgage lending practices and the documents that will govern your and your lender's obligations. He can also help you negotiate a better deal with the financing institution and ensure that your understandings are accurately reflected by the contracts.
- Reviewing title to the property. A seller can only transfer what he owns; it is therefore important to ascertain exactly what the status of seller's title is. When the title insurance company will conducts a title search, they issue a title commitment. The attorney should review the title commitment to look for title issues.
- Assisting at the closing. Your attorney should be with you at the closing for the property. Documents must be signed and recorded, money must be exchanged, and various provisions such as insurance requirements must be resolved. This process may be confusing, and last-minute disputes may arise. Your attorney should have reviewed all documents at or prior to closing, and should explain them to you and make sure they are properly executed.
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