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nj real estate

Top NJ Real Estate Contract Missteps

The attorney review period for NJ real estate transactions exists for a very good reason. Real estate contract mistakes happen every day and can often be costly and stressful to fix. It's best to get it right the first time.

On Behalf of Veitengruber Law | Oct 07,2022

When you are swept up in buying or selling a home, it can be easy to forget about the very real legal contract at the center of the transaction. Most states have an attorney review period for a reason. It is crucial to thoroughly review your contract and ensure that it accurately represents the terms you have agreed to. Even a tiny mistake in a real estate contract can delay the closing or prevent you from taking ownership of the property, both of which can cause financial repercussions. When missteps in NJ real estate contracts do happen, they're often in one of the following areas:

1.   Using the Right Names

This is such a simple detail, but it is missed more than you would think. The full legal name of all parties must appear in the contract. The names in the contract will be used for the title and by lenders on all financial paperwork. The listed names should be consistent with any identification you need to provide. If the seller or buyer is a trust or an estate, the person authorized by that trust or estate should be the one listed to sign the contract. If there are mistakes in the final contract, an addendum must be signed before closing to correct the errors.

2.   Resale Contingencies

While resale contingencies are not part of every real estate contract, errors surrounding these contingencies are common. Some buyers want to sell their current home before they close on their new purchase. If this is the case, the contract must disclose this to the seller. This can ensure that you are on the sample page as the seller and also prevent wasted time on their part. If this contingency is not listed in the contract, the buyer could stand to lose the home if they are not prepared for the closing date.

3.   Items to Convey

Most standard real estate contracts include a clause that lists all agreed-upon items that convey with the property. This can include appliances, lights, furniture, outdoor items, etc. You should not assume all the desired items will be automatically listed. Commonly, sellers and buyers will have differing opinions about which things count as fixtures. A real estate attorney can help if there is a disagreement. Reviewing this list of items before signing the contract can save you time and money.

4.   Seller Concessions

This is often the most important clause for a buyer to get right the first time. Because seller concessions often include large sums of money or significant repair work, these details must be listed. The buyer must make their needs clearly known to ensure that the concessions will be included in the contract. Once the concessions are agreed upon, the seller concessions paragraph needs to be written so both buyer and seller understand precisely what the concessions can be used for. Disputes often arise when the language of this section is ambiguous.

Ensuring your contract is correct and legitimate before signing can save you time, money, and stress when you are purchasing or selling a home. An experienced real estate attorney can help you negotiate a contract that meets your needs. Veitengruber Law has reviewed many NJ real estate contracts. We can help you reach your real estate goals without any time-consuming (and often expensive) mistakes.

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