Selling your home isn’t simple and the reality is that you need a lawyer. Besides the ease and comfort that comes with having an expert navigate the process with you, you can save financially in the long run by using the right lawyer.
As a home seller, you have to satisfy requirements imposed by state, county or local governments. You have to fill out a disclosure form, which shows your knowledge of any material defects in the property that are hidden – and could affect the value of the home. Also, you’ll need to buy title insurance for the property, or at least contribute to the cost and maybe even get a survey of the land. Title insurance protects an owner against losses due to title defects, liens against the property or other matters. The insurance company will defend a lawsuit claiming defective title (ownership of the property), or reimburse you for actual monetary losses. A survey is done to locate, describe and document the boundaries and corners of a piece of land. A lawyer will know all the details of selling or buying residential real estate and will help you meet each one throughout the process.
As important as the requirements is an understanding of the legal and financial implications of selling your home. A lawyer can explain the tax consequences, the effect of easements and agreements or restrictions imposed on the property by a prior owner and whether there are any legal restrictions that could hurt your ability to sell the property later. An easement is a right someone else has to use and/or enter your property without owning it. For example, that person could have the right to use your driveway if it’s in your deed. That person may have never used that right while you owned the property, but he or she nonetheless could still have it. You should also know that there may be legal restrictions on the design or the color of your house that you may not know about, which a potential buyer will want to know. A lawyer will read over your deed and tell you about any concerns before the sale.
What happens if the sale doesn’t go through or you decide to keep the property? Without something in writing to the contrary, you could have to pay a broker’s commission – even if a sale does not happen – or to pay more than one broker’s commission. A lawyer can limit this liability. He or she can negotiate the realtor’s right to compensation if the seller takes the property of the market, or can’t deliver good marketable title. Marketable title is free from valid claims by outside parties. In other words, a marketable title means a future party won’t appear and say they are the actual true owners of the property.
A real estate lawyer knows the right practice and procedure for selling your home. Consider the fee for those services – but also consider the experience and knowledge. When you call or ask about lawyers, don’t just ask about his or her price – ask about his or her plan to get your house sold. It’s not just important, but essential that you don’t set yourself up for a possible future lawsuit – you have to get it right the first time. Putting it simply – you can pay a little now or maybe a lot later. Omar Bareentto is a 2016 Rutgers School of Law graduate and a former contributor to the Rutgers Business Law Review. He collaborated with me on this blog.
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