When you first decide to enter into a real estate transaction, whether buying, selling , or renting, the place to begin is with your attorney. Most people do not see an attorney until they have already signed a listing agreement, or the contract to buy, sell, or lease.
The attorney's at Klein and Fortune, P.A., can help you and may even be able to save you money by guiding you through the documentation, costs, and procedures.
THE LISTING: The listing agreement is the first step. Broker commissions can become payable when a broker produces a buyer ready, willing and able to buy your property; or for effectuating a closing of the transaction. Most people prefer that the broker be paid a commission only if the transaction actually closes with a buyer who the broker produced. However, most listing agreements provide that the commission is payable once the broker finds a buyer ready, willing and able to buy. If it should turn out that there is a title problem, or another reason which precludes the seller from closing, the commission may still be due and payable even though the seller never received the sale proceeds, or the landlord never received any rent from a prospective tenant. Please let us review the listing agreement before you sign it so we can advise you as to its terms and conditions.
WHO DOES THE BROKER REPRESENT?: Most sellers who list their property believe that the broker is their agent. In the past that is how it was, unless the brokerage agreement specifically provided to the contrary. Today, the brokerage agreements can provide that the broker is a "transaction broker", and their obligations to the buyer and seller are limited. A transactional broker does not represent the buyer or the seller.
THE CONTRACT: Once you get through the listing portion of the transaction, or in the event you elect to sell on your own, at some point in time a contract will be presented to you, or you will need to have a contract prepared. Your lawyer should be the one to prepare the contract. Your attorney is the one who you employ to protect your interests. The contract sets forth all of your rights, duties, and obligations, and determines under what circumstances the broker, the seller, and both of them are entitled to retain the deposit, and under what circumstances the purchaser is entitled to a refund of the deposit.
WARNING: If you did not employ an attorney prior to the time you signed the purchase and sale contract, make sure that you designate the closing agent. Otherwise, one will probably be selected for you by the broker or the mortgage lender. Closing costs can vary depending on the closing agent. Generally speaking, the fees charged by Klein and Fortune, P.A., for the same services provided by a title company to do the title work, and close the transaction may cost the same or less, and you have the benefit of an attorney on your side to protect your interests. Check the prices, then decide. Even if an attorney costs more, remember, he also represents your interests only, and a title company does not. Just having your attorney to assist you and protect your interests at closing is invaluable.
THE DEPOSIT: Most purchase and rental agreements require the purchaser or tenant to place a cash deposit with someone. Who holds your money and whether you receive interest on your money is determined by the contract. What happens if the person who is holding your deposit misappropriates the funds? Your lawyer can build into the contract provisions that protect you and your deposit.
CONDITIONS: The contract contains many conditions which should be explained to you, whether you are the purchaser, seller, landlord, or tenant. The conditions most buyers ask me about are those that relate to when the purchaser can cancel the transaction and obtain return of the deposit. Conditions that usually permit return of the deposit are those relating to the failure of the purchaser to obtain mortgage financing after the exercise of diligent effort, and those relating to the condition of the property. On the sellers side, sellers do not like conditions, and want to limit them as much as possible so that they know the sale is done. Your lawyer can write specific clauses to tailor the contract to your needs.
THE CLOSING: The "closing" of the purchase usually completes the transaction. It takes place at the location designated in the contract. At the closing you will be presented with many instruments to sign. Do you know which instruments you are legally obligated to sign, and which instruments are presented to you for signature that you have no legal obligation to sign? The closing statement is usually a nightmare. Do you know which charges you are paying are customary and reasonable, which are higher than normal, and which ones you are not legally responsible for? The attorneys, at Klein and Fortune, P.A., can answer your questions.
TITLE SEARCH, INSURANCE AND SURVEY: The purchaser receives a title policy to the property they are buying. The title policy usually has many exceptions from coverage and reflects the restrictions that affect your use of the property. Who did your title search? Was that person an attorney or a para- professional? Do you have confidence in the title examiner? Many times you do not know if the examination was done properly until you go to sell, and a title objection is raised concerning a matter which occurred prior to the time you purchased the property. Klein and Fortune, P.A., charges the lowest title insurance premiums allowed by Florida law. Want to check our title insurance rates, click Title Premiums.
How about the survey? It reflects the boundaries of your property, easements, encroachments, the location of the improvements, the correct legal description, and the property address. Surveys are complicated instruments. One of the most difficult Continuing Legal Education Seminars I took was on how to read surveys. Easements may give utility companies, governmental authorities, or others the right to use a part of your land for electrical lines, gas lines, sewers, drainage, and other purposes. At Klein and Fortune, P.A., we can properly explain to you any limitations reflected on the survey that may interfere with your use of the property.
INSPECTIONS: Before closing, most of us conduct some form of inspection of the property. I always recommend that the purchaser employ their own inspection company to do the work, and one who is independent of the seller, broker, and mortgage lender. Ask friends who have purchased property for the name of an inspection company, or look in the yellow pages under the heading "Home Inspection Services" or "Building Inspection" for the listing of companies providing inspection services. Please, do not choose the first one you call. Compare prices and services being offered, and consult with your attorney, who may also be able to suggest inspection companies that other clients have used in the past who provided quality services for reasonable prices.
If you feel you require assistance with your real estate sale or purchase, or with your leasing transaction, please give us the opportunity to be of assistance to you. If you want to proceed without an attorney, you may acquire seller closing instruments, leases, landlord tenant notices, other real estate instruments, and instructions by clicking on Forms in the Membership directory. In order to obtain forms, you must be a member of this site. Click Membership now to join.
CHECKLIST FOR HOME BUYERS
Before You Purchase:
1. See your attorney.
2. Do I want to do it myself or utilize the services of a real estate broker?
3. Shop for the best mortgage rates, and costs. Remember the lowest interest rate may not necessarily be the best deal. Look at the good faith estimate of closing costs each lender is required to give to you. As points increase interest rates should decrease.
4. Do I want to buy new construction, a used home, or a fixer-upper.
5. Location, location, location.
Home Inspection:
1. What access do I need to the property?
2. Were additions made to the Property after it was first completed? Were permits obtained?
3. Age and condition of improvements, appliances, and air conditioning and heating systems.
4, Boundary Lines.
5. Floor Plan.
6. Insulation.
7. Monthly expense (principal, interest, taxes, and insurance [P.I.T.I.], and costs of general maintenance.
8. Inspections such as:
Roof
Termite
Electrical
Plumbing
Sewer and septic tanks
Pool
Sea walls
Water heater
Appliances
Tiling
Structure.
Purchase Contract
1. Conditions:
Inspections
Financing
Legal review
2. Date Of Closing
3. Place Of Closing
4. Date of Possession
5. Type of Deed to be furnished
Warranty Deed
Special Warranty Deed
Quit Claim Deed
Trustee's Deed
6. Deposit
7. Legal Description of Property
8. Inspections
Rights To
Limitation on Sellers Obligation To Repair
9. Price and Terms
10. Pro-rations
Taxes
Insurance
Condominium Fees
11. Survey
12. Warranty Given With Purchase
Cancellation Rights
1. Defects Reflected by Inspections
2. Easements and Restrictions
3. Attorney Approval
4. Mortgage Loan Approval
5. Liens and Encumbrances
6. Sale Of Your Property
7. Completion Of Job Transfer
8. Zoning
Condominiums and Homeowner Associations
1. How many Associations are there?
2. What is the monthly payment?
3. Are there land or recreational leases?
4. Does the Association hold sufficient reserves to make repairs to common areas when required?
Title Insurance Charges And Closing Agent
Closing Instruments
Closing Costs
