Buying or selling a home is a momentous event financially, legally, and emotionally. It is important to have deeply experienced and dedicated New Jersey real estate attorneys like those at Silverberg Law, LLC, to help protect your legal rights. The first step, of course, is to make the decision to buy or sell. Then, typically, real estate agents are contacted and retained to show the property and to help the parties reach an agreement on the price (and other matters). Then, generally, the real estate agents have the parties sign preprinted form purchase contracts that identify the parties, the property, state the price, list any needed contingencies and provide for other matters unique to the transaction. Once the contract is signed by both parties, the process of “attorney review” begins. Signing a real estate purchase agreement is a binding legal undertaking involving significant financial obligations. If the contract is not written to accurately reflect the parties’ respective intentions, the end result can be disastrous. The process of attorney review is intended to prevent that sort of “bad result.”
In general, one attorney will represent the buyer and a different attorney will represent the seller. After the contract is signed, both attorneys will review the contract to ensure that the contract meets the legal needs of the party that is being represented. Preprinted form purchase contracts used by real estate agents are typically very good, but sometimes important legal provisions are missing or some provisions must be modified, deleted or added based on the specific needs of the parties to the transaction. And, sometimes, mistakes are made when the contract is executed. For example, a seller might intend that the deal be an “as-is” transaction, but, mistakenly, that provision was not checked and initialled during the execution process. The purpose of attorney review is to ensure that any mistake like that is corrected.
The amount of time for attorney review is usually set in the purchase contract and is typically set at three days after both parties have signed the contract. Typically, during this three-day attorney review period, either attorney may “disapprove” of the contract or request modifications to the contract. If no “disapproval” or modification requests are received, then the contract becomes a binding legal document on both parties. If there is a “disapproval” received, then the contract becomes a nullity. If modifications are requested, the contract becomes binding only when all of those requests are agreed to (or rejected) and finalized.
In practice, aside from when a contract is “disapproved,” the attorney review process involves communications between the attorneys about requests for changes to the contract. Any change that is requested must be agreed to by the other party — typically in writing — or the change is not effective.
Many requested changes involve time deadlines. For example, a given contract might provide that the buyer must complete the home inspection process within, say, 14 days. However, for various reasons, the buyer might need more time. Thus, the buyer’s attorney would send a request to the seller’s attorney asking to modify that provision of the contract to provide additional time for the inspection. As another example, maybe the parties have agreed that this particular transaction will not close until the seller has closed on the new home that the seller is buying. However, maybe the seller is worried there will be a delay in the seller’s purchase. Thus, the seller’s attorney would ask the buyer’s attorney to modify the contract to provide more time.
Other times, the attorney modification requests are more substantial such as:
- Requests to change default provisions
- Attempts to modify the contract with respect to the buyer’s deposit and when due
- Asking for repairs and/or repair credits
- Seeking changes or extensions related to mortgage or other contingency clauses
- Requests for hold-back or other escrows
- And more
Contact an Experienced New Jersey Residential Real Estate Lawyer Today
For more information or if you are buying or selling your home and need legal representation, contact the experienced New Jersey real estate attorneys at Silverberg Law, LLC. We have 30 years of experience helping clients in New Jersey and New York. We provide dedicated and hands on representation in all matters we handle. Use our “Contact Us” link or call (201) 252-7000 to schedule a free consultation.