FAQs: Real Estate Law
FREQUENTLY ASKED QUESTIONS ABOUT REAL ESTATE LAW
How Important is the Real Estate Contract?
Did you know that very often controversies that result in litigation involving real estate transactions could have been avoided by a comprehensive, well drafted agreement at the inception or early stages of a real estate transaction?
Furthermore, potential problems can often be avoided if the underlying issues are properly addressed in the contract of sale. Having a skilled contracts negotiator and draftsman on your side can stack the odds in your favor.
Why does it usually take two to three months from the date the contract is signed, until the closing of title takes place?
Most real estate transactions are contingent upon the purchaser obtaining financing. Although some lenders can issue a mortgage commitment within a matter of days after receiving the completed loan application, many lenders take up to 4 weeks or more to issue a written loan commitment.
Furthermore, the loan commitment often lists conditions that must be satisfied before the bank will designate the loan as “clear to close.” Providing the requested documentation or otherwise satisfying these conditions may take some time.
For houses and condominiums, the Purchaser’s attorney will obtain a title search, including various departmental searches. The title report may identify title defects, or other issues that must be resolved.
If the Seller does not have a current survey, the Purchaser’s attorney might be able to locate a recent survey, which may be sufficient, when accompanied by a current survey inspection and survey reading. Otherwise, a surveyor will need to inspect the property and prepare a new survey.
For co-op apartments, the Purchaser’s attorney will usually obtain a “co-op search” which may identify liens or other title defects or encumbrances that need to be satisfied or otherwise resolved. The Purchaser of a co-op apartment will usually be required to submit a detailed co-op application to the co-op’s Board of Directors, together with requested financial documents, character references, etc. Thereafter, an interview of the prospective Purchaser will be conducted by the co-op’s Board of Directors. The purchase of a co-op apartment is usually contingent upon the co-op’s Board of Directors’ approval of the Purchaser. Often the Purchaser may need to wait several weeks for the coop’s Board of Directors to schedule and conduct the interview, and to advise the Purchaser of the Board’s decision.
If the Purchaser and Seller are both anxious to expedite the closing, it may be possible to shorten the time period from contract signing to closing, however sometimes delays cannot be controlled by either the Purchaser , the Seller, or their real estate lawyers.
What are “Closing Costs” and Why Am I Paying So Much Money at the Closing?
In a typical real estate transaction, the Seller and Purchaser often have various substantial expenses. For example, you might be responsible for paying some of the following fees:
fee title insurance, mortgage title insurance, deed and mortgage recording fees, departmental searches, transfer taxes, bank fees, bank’s attorney’s fees, co-op transfer and financing fees, co-op “flip tax, “, managing agent’s fees, real estate broker’s commission, and your real estate attorney’s fee. If you are purchasing a co-op apartment or condominium from a sponsor, you will likely be paying additional fees, including some that would otherwise be payable by the seller.
In addition, adjustments are computed in order to apportion recurring charges such as real estate taxes, condominium common charges, co-op maintenance, and other fees as of the date of the closing of title, or the date of transfer of possession from the Seller to the Purchaser.
Considering the financial complexity of the real estate transaction, it is not surprising that most people do not understand every expense that is payable at the title closing. Your attorney should explain all of your expenses, and do everything possible to both verify that they are accurate, and to minimize or avoid those that can be negotiated or eliminated.
Are All Real Estate Closing Statements the Same?
After the closing of title, your real estate attorney will provide a closing statement, which should itemize and clearly explain all of your expenses, as well as the adjustments. The closing statement should be in a format that is easy to understand, so you and your income tax preparer can easily identify important financial information about your transaction. Most of the Purchaser’s and Seller’s expenses and adjustments are also contained in the Federal RESPA Statement, however many clients and income tax professionals find that document confusing and extremely difficult to understand.
Therefore, the closing statement provided by your real estate lawyer is an important document that will assist you in understanding your purchase or sale, and in calculating your tax basis in the property you purchased, or your taxable proceeds for property you sold. It is likely that your income tax preparer or accountant will refer to the closing statement in preparing your income tax return for the year of the purchase or sale, and for the year of a future sale of the property. Keep in mind that errors or omissions in the closing statement, or inaccurate or vague explanations of expenses listed in the closing statement might cost you significant money on your income tax return.
The format and completeness of the closing statement varies among real estate attorneys. Some real estate lawyers simply fill in the blank spaces on a single page form provided by the title company. We pride ourselves on the thoroughness of our closing statement, as well as the ease in understanding all the information it contains.
Should I Select a Real Estate Attorney Based on the Lowest Fee?
We do not recommend that your paramount criteria for selecting a real estate lawyer be which lawyer charges the lowest fee. Furthermore, in our experience, the difference between the fees charged by one New York real estate attorney and another is usually no more than a few hundred dollars.
We suggest that you select a New York real estate lawyer based on either the recommendation of a trusted friend or relative, or by your impression of the real estate attorney’s competence and thoroughness, after you speak to the lawyer. Also, you might ask whether the attorney will be available to talk to you when you have questions or concerns about the real estate transaction. Consider asking the real estate attorney to show you a sample of the closing statement you will receive after the closing of title. The difference between our closing statement and some other New York real estate attorneys’ closing statements may surprise you.
Of course, paying more does not guarantee better legal representation. However, the converse might be true. If a real estate lawyer quotes a legal fee so low that he or she will be unable to devote the time needed to provide quality representation, or to deal with an unexpected issue that may arise, who will suffer? When you consider all the expenses that a Purchaser or Seller typically pays in a real estate transaction, the difference of a few hundred dollars between the high volume real estate “mill” and our law firm is insignificant.
Your selection of the best lawyer to represent you may well be your wisest decision. Most people long remember the “bargain” that ultimately became the most expensive and most aggravating experience.
In our experience, when prospective clients contact our firm to help them after they have already paid another real estate lawyer, who will not or cannot help them, we have usually found that they were represented by a volume priced attorney.
HIGH QUALITY LEGAL REPRESENTATION AT MODERATE FEES
The Law Offices of Michael W. Goldstein provides high quality legal services and personal attention to each client. Our legal fees are extremely fair, considering the level of professional service we provide. However, for those clients who will select a lawyer based solely on the lowest fee charged, our firm will probably not be your first choice.
Our Firm serves its clients with a wide spectrum of legal services for individual and business real estate transactions, real estate leases, and real estate litigation. For more information about Michael W. Goldstein’s legal experience and areas of practice, see our Attorney Profile and Our Firm pages.
If you would like to read what our clients say about us, please see our Testimonials page.
TELL US ABOUT YOUR REAL ESTATE TRANSACTION OR LEGAL MATTER
To have your real estate transaction or other real estate legal matter reviewed, we invite you to complete our Questionnaire, or click Contact Us to send an email. You may also call Michael W. Goldstein to discuss your real estate transaction, commercial lease, real estate litigation or other legal matter by telephone, or to schedule a consultation at our office.
There are strict time limitations that apply to New York lawsuits including real estate litigation, commercial litigation and other types of New York litigation. The statute of limitations (time limit for commencing litigation) varies depending on the type of case, and in some instances, depending on the defendant being sued. Furthermore, many types of claims and lawsuits also have other time limitations (in addition to the statute of limitations), such as time limitations for filing a Notice of Claim, Notice of Intention to Make Claim, and other important documents.
The information contained in this website is not intended to constitute legal advice, nor to create an attorney-client relationship or lawyer-client relationship. We recommend that you discuss your legal matter or case with a NY real estate lawyer or New York attorney promptly.
Visiting our website, submitting any information via questionnaire or email, or discussing your case with us does not create an attorney-client relationship. An attorney-client relationship with our law firm can only be established with the signing of a written retainer agreement prepared by our law firm.
Under New York law, in the event there is no recovery in a contingency fee case, the client is responsible for the expenses of the litigation, including court costs and disbursements.
Prior results do not guarantee or predict a similar outcome with respect to any future case or legal matter.
This website is not intended to solicit clients for real estate transactions, real estate litigation, contracts, or any other legal matter outside of New York State. However, we do represent clients who live outside of New York State, and are engaged in a New York State real estate transaction, NY real estate litigation, or who need legal services for other legal matters that involve New York law, or a dispute that is or may be litigated in the courts of New York State, or disputes that may be arbitrated or mediated in a New York State Alternative Dispute Resolution forum.
NEW YORK LAWYER DISCLAIMER
The New York real estate law, New York real estate litigation, and NY real estate contracts information, and other New York legal information contained in this website is not intended to constitute legal advice, nor to create an attorney-client relationship or lawyer-client relationship. We recommend that you discuss your NY real estate law, NY real estate contract, NY contract negotiation, or NY real estate dispute with a NY real estate lawyer or New York real estate attorney, or NY real estate litigation lawyer promptly.
New York real estate transactions lawyer, NY real estate litigation attorney, NY real estate contracts Lawyers and Attorneys New York, representing real estate clients in New York City, Manhattan, Bronx, Brooklyn, Queens, Staten Island, Long Island, Nassau County, Suffolk County, Westchester County, Rockland County and upstate New York.
Law Offices of Michael W. Goldstein is a New York real estate transactions law firm, also representing clients in commercial leases, real estate litigation, and real estate disputes.
Law Offices of Michael W. Goldstein, a New York real estate law firm