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Real Estate Law Overview
Real Estate Law Overview
Understanding the Role of Real Estate Brokers in Property Transactions
When aiming to sell a property, an owner may enlist the services of a real estate broker to connect with prospective buyers. This partnership is formalized through a listing agreement, committing the broker to actively seek potential buyers, and in return, the seller agrees to compensate the broker through a commission upon the successful sale of the property.
Conversely, potential buyers can also engage a real estate broker to identify properties that match their criteria. It's important to note that real estate brokers must adhere to stringent licensing criteria, which are determined by individual states.
Functioning as an agent, a broker or salesperson owes specific duties and responsibilities to their client, be it a buyer or seller. However, when a property purchase agreement is reached, it's a direct contract between the buyer and seller. In this scenario, the broker remains an external party, typically offering no guarantees concerning the property's condition or value.
Understanding Real Estate Contracts and Property Transfers
When a buyer and seller agree to a real estate transaction, their contract is steered by foundational principles of contract law. For such transactions, the law typically mandates that the agreement be documented in writing, ensuring transparency and legality.
For a real estate title to be considered free from potential liabilities, it needs to stand clear of any encumbrances, liens, disputes, or other possible impediments. It's common for a buyer to engage the services of an attorney or a title insurance firm to conduct a thorough title search, ensuring there are no hidden complications.
This title search delves into the public records of the property's county, creating a chain of title by examining all past recorded deeds. This process also uncovers any potential obstacles like mortgages, unpaid property taxes, governmental claims, prior legal judgments, or easements that might be associated with the property. Opting for title insurance can offer the buyer protection against potential losses arising from title discrepancies.
For the completion of the property transfer, the seller must provide a deed with an accurate property description. To solidify the change in ownership, many jurisdictions necessitate the deed's official recording, ensuring subsequent potential buyers are aware of the property's history and change of hands.
Understanding Mortgages and Foreclosures
One of the prevalent methods to finance a real estate purchase is through a loan, backed by a mortgage on the said property. Essentially, a mortgage represents an interest in the property, kept as collateral for a loan. Borrowers are usually expected to repay this loan in periodic installments, comprising both the principal amount and its interest.
However, if a borrower fails to keep up with these payments, it can trigger a foreclosure. This means the lender may demand the entirety of the outstanding loan to be paid immediately. If the borrower still doesn't settle the mortgage debt post-foreclosure, the property might be sold off to cover any outstanding amount.
The specifics of the foreclosure process can vary, influenced by state regulations, the mortgage's terms, and any other existing liens on the property. Many jurisdictions offer grace periods, allowing borrowers to make overdue payments and prevent foreclosure. Furthermore, many lenders prefer negotiating a revised payment plan with the borrower to avert the foreclosure process.
Consult with Our Real Estate Attorneys
Navigating real estate transactions and resolving disputes can be intricate, given the diverse and evolving legal landscape.
Whether you're in the process of buying or selling property, or find yourself in a real estate disagreement, it's crucial to seek expert advice. Reach out to the seasoned real estate lawyers at Abrams, Walt & Associates to safeguard your interests and rights.
DISCLAIMER: This site and any information contained herein are intended for informational purposes only and should not be construed as legal advice. Seek competent legal counsel for advice on any legal matter.