Whether you are buying or selling, these 4 simple tips you can save you stress and heartache with almost any real estate transaction.
1. When to use a Real Estate Agent
A commercial or residential real estate buyer or seller is gets the best protection when represented by a real estate agent and a real estate attorney in any real estate transaction. A real estate agent can add value to your transaction and perform tasks such as:
- Provide information about the local real estate market
- Help set the listing price for your home
- Identify needed repairs and improvements to improve home value
- Stage the property to make it look its best
- Market the property so it can be found by buyer
- Evaluate offers and propose counteroffers
When listing property an exclusive real estate agent will represent the Seller’s interests. It is crucial that the buyer and seller have different real estate agents in the transaction to avoid a conflict of interest. Agents are paid by commission based on the sale price of the property.
Dual agency is when a single real estate agent represent both the buyer and the seller. This scenario creates a guaranteed conflict of interest for the agent who wants to get the deal closed and get paid by the sellers and buyers portion of the commission.
As a buyer or seller it is essential for you to have the undivided attention of your agent in handling your portion of the deal and in giving advice to allow you to make good decisions based on what is in your best interest. Even an agent who represents only you has a financial interest in seeing the deal go through.
Experienced, reputable agents do not let this interfere with their guidance. However, less conscientious agents can compromise your interests for their own pocketbook.
It is a smart decision to hire a real estate attorney to review your transaction documents even when you are represented by a real estate agent. An attorney is very clear about who is the client and there should be no conflicts in that relationship. Attorney review will make sure that the terms of your real estate agreement and other documents are correct, in your best interest and can answer your questions about the legal consequences about the transaction.
2. Protect Yourself with a Real Estate Attorney
Hiring a real estate attorney to review your real estate sale or purchase transaction before escrow closes can guard you from costly mistakes and ensure that contract details are accurate, explain the significance of agreement terms and take action to avoid problems before they become big and expensive issues.
An experienced real estate attorney can guide you from the beginning of your real estate sale or purchase through closing by preparing, reviewing and negotiating real estate contracts and related transaction documents. The attorney can offer guidance in a variety of areas including methods to limit exposure to liability, evaluation of title issues, appraisals, disclosures, inspection reports, property conditions and loan documents.
Buying or selling real estate is a complicated process. People mistakenly may think that their real estate agent is as experienced as a real estate attorney regarding the legalities of the transaction.
While real estate agents and brokers are aware of the paperwork involved in a transaction, they do not know the intricacies of the law. Only an experienced real estate attorney can help you understand your rights and avoid costly litigation. Real estate buyers and sellers can save money by having the guidance of a well-qualified attorney before there is a problem.
3. FISBO – For Sale by Owner
You can save thousands of dollars when you hire a real estate attorney when you have identified a buyer to purchase the property (where no real estate agent is involved). This transaction is called a “FISBO” or “for sale by owner.” In this situation, when the seller hires a real estate attorney they can save the cost of the 3% to 6% real estate commission based on the sale price when there are no real estate agents representing the seller and buyer. This savings can translate into a lower sale price for the buyer and help the seller gets the real sale price they want while being expertly represented by an attorney.
It is crucial that the seller and the buyer each have their own attorney to represent their interests in the deal. An attorney cannot represent both a buyer and a seller without a significant conflict of interest.
4. Ask Questions
If you have questions or concerns, make sure to ask your real estate attorney and agent to clarify.
It is important to ask questions and get clarification to make sure you understand the details of your transaction.
If you do not understand something, ask.
Are you facing issues with a real estate transaction?
For expert legal assistance with any aspect of your real estate sale or purchase, contact the Law Offices of Lisa Wills either by email or by calling (925) 463-9000 – we are here to help you through your transaction.