The Top 5 Legal Traps In Real Estate Deals — And How To Avoid Them
When buying or selling a house, you should be aware of the potential legal traps that can crop up in a real estate deal. If you’re not careful, these traps can cost you time and money.
In this guide, we will discuss the top five legal traps in real estate deals and how to avoid them with the help of a real estate lawyer.
Failing to perform due diligence on the property properly
When you’re looking at purchasing a property, you must do your due diligence. This means that you need to research the property thoroughly before making an offer. You should look at factors like the zoning regulations, any outstanding liens or mortgages on the property, and anything else that could affect your property ownership.
You could be held liable if you fail to do your due diligence and something goes wrong with the property. For example, if there are outstanding liens on the property that you weren’t aware of, you could be responsible for paying them off. Or, if the property is zoned for commercial use and you try to turn it into a residential property, you could be fined or even forced to tear down any improvements you’ve made.
Bottom line: don’t skip out on due diligence when purchasing a property. It’s not worth the risk! Spend the time upfront to ensure you know what you’re getting yourself into.
Entering into a contract without fully understanding all of the terms
In real estate deals, it is not uncommon for one party to try to take advantage of the other by hiding specific terms in the contract. This can be a legal trap if the other party does not take the time to understand all of the terms before signing.
The hidden terms may not be discovered until after the deal has been completed, at which point it may be too late to do anything about them. It is crucial to ensure you understand everything you agree to before signing any contract. Otherwise, you could end up in a very bad situation.
If you have any questions about the contract, consult your real estate agent or a real estate lawyer before signing.
Not having a solid contract in place
The contract is one of the most important aspects of any real estate deal. This document outlines the terms of the transaction and protects both the buyer and seller from potential problems down the road. Without an agreement, either party could back out of the deal at any time for any reason.
Assuming all title company procedures are followed
Assuming all title company procedures are followed is a legal trap in real estate deals. This is because many title companies are not following the proper procedures.
If you assume that all title company procedures are being followed, and they’re not, you could be in for a nasty surprise. It’s always best to err on the side of caution and check with your real estate lawyer or closing agent to ensure everything is being done correctly.
Not getting independent legal advice
Not getting independent legal advice can be a legal trap in real estate deals if you’re not careful. Having a lawyer to protect your interests and ensure the deal is structured correctly is essential. Without independent legal advice, you could be signing away your rights without even realizing it. So if you’re considering buying or selling property, get some good legal advice from a real estate lawyer first.
Avoid costly legal mistakes in your real estate transactions by contacting a Real Estate Lawyer
As a real estate investor, you need to know these legal traps in real estate deals and how to avoid them. By knowing what these traps are and taking precautions, you can save time, money, and hassle.
Contact our team at Malley Law Firm today if you have any questions or want more information on how to protect yourself during a real estate transaction. We’re here to help you make smart, informed decisions that will benefit your business now and into the future.