Selling Property: Real Estate Laws Involved

Selling property is a complicated and time consuming process today.  It takes more than a handshake to complete a transfer of property; in fact, it takes weeks, with the involvement of many people, often including real estate lawyers who can guide you through the process and ensure that your property transfer is legal and that any loopholes that could cause problems down the road are eliminated.  There are two primary steps involved in selling property:  executing a contract and closing the transaction.

Property Contract

The property contract is the primary agreement between a property seller and buyer.  It establishes the terms under which the transaction will take place and the exact details of what is included in the sale.  Some of the specific details that are generally included in any contract are:

• The purchase price and down payment for the property
• The personal property which is included and excluded in the sale
• The date when the sale will be completed and the deed will be transferred
• Financing contingencies for the buyer
• An inspection contingency, whereby the buyer can have the property inspected and, if found unacceptable, cancel the contract
• A provision for a final walk-thru inspection by the buyer
• A legal description of the property and its location or address
• A requirement that the seller will provide good, or marketable, title to the property
• Disclosure of closing costs
• Various other details and provisions, some required by the state, which can be found in most standard contracts

Marketable Title

One of the primary provisions of a contract for sale is the transfer of a marketable title by the seller.  This means the seller must provide an abstract of title, which includes a history of ownership and encumbrances on the property plus insurance to cover any challenges to that title.  While it is a part of producing such an abstract, a title search is a separate function that must be performed in order to procure the abstract of title.

Condition of Property

In some states, the law also requires sellers to fill out an extensive disclosure form that specifies that all aspects of the home and its equipment are working properly.  Other states do not require such a form, but that the seller inform the buyer of any defects.  In all sales, by law, the seller is providing an implied warranty of fitness which assures the buyer that the home is suitable for its intended purpose, which is the habitation of the buyer.

Closing the Property Sale

Once all the conditions of the contract have been agreed upon and met, the closing of the transaction and transfer of ownership can take place.  Among the paperwork that must be reviewed and signed, the principals will find

• Loan or mortgage documents
• Payment to the seller
• Inspections and title documents for the property
• Any required insurance policies
• The deed to the property
• All documents required by local and state laws
• Keys to the property, where applicable

Clearly, there is a great deal of detail to be completed throughout the process and to be confirmed at the closing of a property sale.  Few laymen are willing or able to ensure that all of these requirements are fulfilled completely and on time.  That is why a real estate lawyer is such an asset to these kinds of transactions.  Not only can they familiarize you with the local and state requirements for your transfer of property, they can ensure that both you and the other party have fulfilled your obligations and the transaction can be completed successfully.