Frequently Asked Questions:
Why
do I need an attorney to
buy
or sell my house?
Even
though an attorney may not be needed to negotiate the initial terms of the
deal, it is often suggested that you consult with an attorney prior to
signing a contract. Legal issues such as zoning, obtaining good title, pre or post closing possession of the
property, tax consequences or a buyer/seller wanting to "pull out" of
a deal, are just a few. There
are numerous other legal issues that may arise requiring an attorney
input.
What
is an abstract of title and why is it important to have?
An
abstract is the history of your property. Generally the Seller will have
this in their possession. An abstract is either prepared or updated by a commercial abstractor; usually a sixty year
title search is to trace the chain of title. The abstract will show deed
transfers, estate proceedings, mortgages and any other liens/encumbrances
on the property.
What
is the importance of a survey?
A
survey will show you what an abstract can't. An attorney knows how to
review a survey and identify possible future issues that may arise. For
example: a driveway may cross over property lines, fences may have been
incorrectly placed, or improvements may violate set back limits. Any
recent additions to the property that may
require zoning permits will also be shown.
What
is a Property Condition Disclosure Statement?
In
2002 NYS began to require that the Seller must deliver to the Purchaser a
Property Condition Disclosure Statement (PCDS) consisting of 48 questions
regarding the Seller's actual knowledge of the property condition. If the
Seller refuses to deliver a PCDS to the Purchaser then they must allow a $500
credit at closing.
Why
should I have a home inspection done?
Even
if a PCDS is delivered, a home inspection should be performed. There are many
specific details that a home inspection will reveal that a PCDS can't. In
order to protect yourself against future problems or complications, such as
termites, asbestos, radon or lead based paint. It is recommended that a home
inspection be performed.
When
should I obtain financing?
Once
a contract has been signed and accepted by both parties, a copy of the
contract should be brought to your lender and/or broker so the loan
application process can start. Your lender/broker may request that a credit
report be done so they can see what debts you have and check your credit
history. Often required are copies of tax returns and recent pay-stubs for proof of income. The longer it takes to obtain a mortgage commitment the longer
it will take to get your transaction closed.
How
will I know when I can close on my purchase or sale?
Each
party will likely be represented by an attorney. If a lender is involved, they
will also have their own attorney. It is up to the lender to issue a "clear to
close" on your loan. Once all the title documents have been prepared and
approved by the bank attorney and all documents the lender requested from you
are submitted then a "clear to close" may be issued and a closing date may
be scheduled.
If
yours is a cash deal and no lender is involved, you have only to wait for the
title documents to be prepared and accepted. Then a closing date may be set.
It
is important to remember that the anticipated closing date set forth in the
contract is a target date. It is not set in stone. There are many issues that
can arise to which will delay a closing. The assistance of a competent attorney
can help to avoid such delays.
Whether
you are a Purchaser or a Seller, it is important for you to understand the terms
and conditions of your contract and how they affect you. An attorney's advice and direction are important from the minute you
decide to buy or sell a home until the closing and sometimes after.
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Bonarigo & McCutcheon, Attorneys at Law