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6 Legal Questions to Ask Before Buying a Home

It is easy to fall in love with a home and forget about all those important legal questions you should ask before making an offer. It is important that you have these questions ready for your attorney and the seller’s attorney before moving forward with your purchase. The answer may not always be what you want to hear, but it will save you time, money, and many headaches in the future.

You are wise to be doing some research before making your purchase. Here are some questions that we feel are important to ask, because real estate agents may not always tell you upfront.real estate attorney

1) Do I need a real estate attorney to create a contract and to close on the house?

The law varies from state to state. In North Carolina, the majority of these sales contracts are presented to the home seller by the real estate agent. The agents usually use a standard form by the North Carolina Association of Realtors. However, a real estate attorney can complete the contract for you if it makes you feel more comfortable.

2) Are there any liens or claims on the property?

An attorney will do title searches and acquire title insurance for the home buyer after you have entered into a written purchase contract. This means we will examine any public records of present and previous owners to find any liens or claims on the property. And for a good reason; only after a title search will you learn that something may be wrong with the title to the land. The previous owner may not own the land, or the property may have claims that must be paid in full upon closing.

3) What should I look for in the property deed?

A real estate attorney will make sure that the property is transferred to the buyer without any defects shown in the public records. The property deed is the document that says the home buyer legally has ownership of the home or property. Also, make sure to ask if there are any deed restrictions that may prohibit certain construction on the property or use of the property. The deed needs to be notarized and then recorded in the county’s Register of Deeds office.

4) Are there any problems with the house?

Make sure you ask questions about the roofing, foundation, insulation, and any appliances or air systems that have been repaired or replaced. In NC, the seller is legally required to complete a “Residential Disclosure Statement” as a part of the “offer to purchase” whereby the seller is required to answer numerous questions about the conditions of the house. Also, make sure you ask to see the paperwork. Without any documentation, it is hard to be absolutely sure that the seller really replaced that AC system.

*Caveat Emptor, or Buyer Beware, puts the responsibility on the buyer to learn about any defects or problems with the home. If you wait until after closing, it will be too late. There is an Implied Warranty of Fitness, which means the seller should ensure that the property is habitable, but it can be hard to enforce and prove this in court.

5) What if something goes wrong after putting down a deposit on the home?

There are instances where you may put a deposit down, but then the house doesn’t pass inspection, or your mortgage isn’t approved. These contingencies should have been addressed in the Offer to Purchase Contract. In addition to Ernest Money, the buyer can pay a non-refundable “due-diligence fee” which allows the buyer to get its Ernest Money if the buyer cancels during the due diligence period which is the time period set for the buyer to inspect the property. The seller’s agent or attorney will hold the deposit. To get your deposit back, you may have to put up a fight. The seller’s agent/attorney will not be able to release your deposit unless they have consent from the seller. Make sure everything is in writing and pay close attention to the detail and dates in the contract. Your real estate agent is of great advantage to you in this case.

6) Is a short sale possible?

A short sale is when the seller owes more money on the property than the price that they are asking. Although it sounds like it may give you the upper hand in the bid, it is actually better that the seller has a good amount of equity in the property. If they do owe more than they are asking, it is unlikely that the seller will pay for closing costs or any repairs. The main complication is that the bank holding the debt has to agree to accept less than what is owed to it.

Keep in mind that the real estate market is always changing. Depending on when you are looking to purchase a home, the market may be more influential for the buyer or the seller. Don’t procrastinate on finding the answers to these questions because you may miss the chance to buy the home that you absolutely love.

Contact us today if you have more questions about buying a home and would like to consult with a professional real estate attorney at Kelly & West.

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    What Our Clients

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    Alexander C. – Harnett County Property Owner

    “Reggie Kelly is a fantastic attorney with fantastic paralegals. My wife and I have been using him and his firm since 1983 when we first purchased property in Harnett County 37 years ago. He offers excellent legal advice and guidance. He never gets in a hurry to get us out the door because of his next appointment. He always takes the time needed to check out all of the issues that might come up. Reggie Kelly is a proud American and he loves our country and he wants everyone to do well. Reggie Kelly is an even finer person than he is a fantastic attorney and we are very fortunate to also be able to call him and his wife Cheryl our friends. We give him a 10 STAR Review!”