When an attorney represents a party in a real estate transaction, he or she performs various functions, both administrative and legal in nature, in order to ensure a timely, efficient and proper closing for the client, whether the client is the seller, buyer or bank. Most of the complex legal work that an attorney performs in a real estate transactions occurs behind the scenes such as the title search, title examination, pre-closing tasks and post-closing tasks such as settlement and disbursements.
Among the many administrative tasks that an attorney performs includes establishing contact with all of the parties in the transaction and scheduling a closing date and location; requesting and obtaining tax, water and sewer information; ordering releases; preparing the necessary legal documents; and preparing a financial summary of the transaction. The efficiency and accuracy of conducting these administrative tasks will ensure a timely and smooth closing transaction for the client.
An attorney in a real estate transaction performs numerous tasks that are legal in nature and that could make or break a deal. Real Estate transactions are regulated on both the Federal and State level. Therefore, there are a host of statutes and regulations that must be adhered to in a real estate transaction. Failure to conduct a closing correctly can result in fines to the parties or even putting the validity of the transaction in question.
Among the many legal tasks that an attorney performs on the client's behalf in a real estate transaction include the following:
1. Review of the Brokerage Contract or Listing Agreement, including its terms, conditions meaning and other items of importance in these documents.
2. Provide Important Seller Documentation. An attorney can advise a for sale by owner seller about the sales process and provide the legally required documents that the seller must provide to prospective buyers such as disclosures and fire inspections.
3. Advise in the Preliminary Negotiations by advising the client regarding terms and conditions that should be negotiated such as terms of payment, mortgage contingency clauses, status of fixtures or personal property, and the risk of loss by casualty pending the closing.
4. Draft and/or Review the Purchase Contract. If you retain an attorney prior to entering a Purchase and Sales contract, an attorney can draft this document for you. If you already entered a contract, an attorney will scrutinize this document and advise you of the terms and conditions and your obligations under the contract.
5. The Purchase and Sales is the most important document in the transaction and will contain terms and conditions that you must be aware of and be in compliance with.
6. Review and advise on the mortgage and finance commitment. Points, commitment, service charges, prepayment penalties and a host of other factors should be reviewed.
7. Determining the status of title. This is considered one of the most important legal tasks an attorney will perform in the real estate transaction. A Rhode Island Real Estate Attorney will search, abstract and examine the land evidence records, probate records, surveys, plat plan and more in determining the status of a title and its marketability and insurability.
8. Eliminating title problems. If a title defect is discovered, some type of action may be available to cure the problem. An attorney can initiate and review any such problem.
9.Drafting Instruments. In order to properly convey and receive real estate certain legal instruments must be drafted in accordance with laws and regulations.
10. Conduct the Closing. An attorney can attend the closing with you and advise you as to what you are signing, the terms and conditions, the HUD-1 settlement sheet and answer all questions that you will have during the closing.
Whether you are buying or selling a house, having an experienced Rhode Island real estate attorney represent you as early as possible in the transaction will help ensure that your rights are protected and that your real estate closing is conducted in a timely, efficient and legally compliant manner. A Rhode Island attorney will help you understand the numerous documents, the financial arrangement of the transaction, the status of title and ensure that all items of importance are covered and accounted for.
Buying or Selling a home is a large financial transaction with many complex issues that could turn into a nightmare for you before, during and sometimes well after a closing if the transaction and closing is not completed correctly.