Real estate matters can be known to generate a great deal of written communications that may contain somewhat confusing legal jargon making the assistance of a real estate attorney an absolute must. Hagen Law prides itself on being client oriented and ensuring understanding and comfort. We are able to achieve this through dedicated attention and the education of each one of our clients.
Real Estate Closings
The purchase or sale of real estate – whether it is a primary residence, a vacation home, or an investment property – is a significant financial decision for most individuals and families. Whether you are the buyer or the seller, Hagen Law can assist you with your real estate transaction to ensure your interests are well represented and protected. We will work diligently for you throughout the entire process from review, negotiation, and finalization of the contract of sale to assistance with the closing, and everything in-between. We create value for our clients by bringing attention to every detail and making certain that your transaction goes as smoothly as possible.
What to expect
The New Jersey real estate closing process can be broken down into four main stages: the attorney review period, the inspection period, the securing of a mortgage, and the closing.
The Attorney Review Period
The attorney review period begins once an offer has been accepted and a contract is signed by both parties. The buyer and seller send the signed contract to their respective real estate attorneys to review the terms and ensure proper protection of their clients’ rights. Any negotiation of terms must commence within 72 hours of signing or else the contract is binding as is.
The buyer should expect to provide a good faith deposit, typically between $1,000 and $5,000, which demonstrates the buyer’s intention to complete the purchase. If the buyer and seller cannot agree to the terms of the contract, the good faith deposit is generally refundable.
The Inspection Period
Home inspections provide the buyer with a report consisting of suggested repairs and any material defects found on the property. Typical inspections include a general home inspection, whether there is evidence of termite damage, any presence of asbestos and lead paint, and a test of radon levels found within the home. Additional inspections may include well water testing, a “sweep” for underground oil tanks, and/or a septic certification. A certificate of occupancy and a fire inspection are also required; depending on the municipality of the property, these may be the responsibility of the seller.
The buyer may request the seller to make certain repairs, to reduce the sale price, or make concessions at closing if the results of the inspections reveal defects previously unknown to the buyer. The seller has the right to agree, to refuse, or to negotiate the buyer’s requests. If an agreement cannot be reached, the buyer can back out of the deal and generally have their good faith deposit refunded.
The Securing of a Mortgage
Before the home search even begins, a buyer should consult with a lender to confirm the buyer’s purchase power. The lender will ask for various forms of financial documentation to determine whether the buyer is a good candidate for a loan. The lender will also order an appraisal to certify that the property is worth what the buyer is paying. The buyer is required to purchase homeowner’s insurance and title insurance and send evidence of both to the lender prior to the lender making any disbursements on the loan. In many transactions, the seller may request a copy of the buyer’s mortgage commitment prior to the closing to ensure that the buyer is financially fit to complete the purchase.
On the day of closing, the buyer will conduct a final walkthrough to make sure the property is in the same condition as when the process began and that any agreed upon repairs have been made satisfactorily. The buyer and seller have historically both been present at the closing in order to sign all of the documents related to the sale. With the evolution of technology, however, the seller is able to sign all necessary documents beforehand and have the seller’s attorney hold them in escrow until the buyer has met all of its closing conditions. Once the buyer has signed all closing documents and has paid the balance of the sale price, the real estate closing process is complete.