Selling and buying homes requires legal paperwork. Writing contracts to sell your home is tricky business and you do need a lawyer to help you. Find one by asking for recommendations from family or friends or by looking for one in the phone book. Ask for a consultation before deciding.
What to Know About Your Lawyer
Ask questions. Often you can have a free consultation before deciding on a lawyer. Be sure that they can accept evening and weekend calls. Find out the costs. Ask if you’ll be charged hourly or a flat fee, if you must pay for phone calls, have a limit of visits and if you will be charged if the deal does not go through. Although using a lawyer costs some money, it is well worth the peace of mind.
You would be well advised to use a real estate specialist rather than a general lawyer. Not only are they more familiar with current real estate law, but they are accustomed to the demands of closing deals. They will understand the that real estate contracts need to be handled quickly – often within 24 hours, and will be more likely to accept weekend or evening calls. This is important as you don’t know when an offer will be made.
How Your Lawyer Can Help
Your lawyer can also help you fill out the contracts and understand the language used. Having certain areas pre-filled means you won’t make mistakes in the anxious moments that a prospect is willing to make their offer. It will also prevent you from creating loopholes for the prospect if they get buyers remorse (unfortunately, not all that uncommon).
Proper names and addresses are crucial. If these are filled out beforehand you won’t have to deal with complications because you misspelled something or put down incorrect information.
Your lawyer will require you to make four copies of each document, one for you, one for them, one for the buyer and one for their lawyer. Counter-offers and addendums will also need to be dated, signed and copies made for each party.
Your lawyer can advise you of other paperwork – surveys, insurance papers, etc. – that need to be included.
Lawyers can also provide escrow accounts. This means that the buyer will not be handing their $3000 deposit check to you, they will be placing it in trust of your lawyer. Their money will be returned if the offer doesn’t work out, or else applied to the purchase of the home.
Your lawyer will also work with the buyer’s lawyer in exchanging the relevant documents. The title transfers and new mortgages will be handled by the lawyers. They will check with the Land Titles Office to make sure everything is correct. A new title will be drawn up and the mortgage information changed.
The lawyers will collect the money from the buyers and pass them the keys on possession day.
A note of caution: if the buyers do not have their own lawyer, do not recommend yours. It is in everyone’s best interest to retain their own legal counsel
Having a lawyer to discuss the details of selling and the legal requirements will help ensure the least hassle when selling your own home. This is an area where an ounce of prevention is certainly better than a pound of cure.
About the Contract
One of the first things you must do before signing an offer is add the following:
"This offer is accepted subject to lawyer’s approval as to form and content by (state date and time)."
Usually give no more than 24 hours unless it’s a weekend and you anticipate a delay. If you don’t put this in the offer you could be in for a messy situation.
Here’s where you need to pay attention.
Often times a buyer will want to add a subject to the offer. Assuming that you’ve already remembered to add the subject about having the offer approved by your lawyer (and they can state the same) here are some other types of subjects you may be requested to add.
‘Subject to Financing’
Clearly, if the owner isn’t coming with cash, they will need to have their financing approved. This is for everyone’s benefit. You do not want to have signed a deal to sell your home to someone with no money, and they should not be legally responsible for buying a home with no financing.
You cannot know for certain if the information your buyers have given you is correct. They may say their credit is good but until a bank agrees, you have no basis.