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Boston Real Estate Lawyers

The Boston real estate lawyers at Joshua Spirn and Associates can help you with your real estate needs in the Boston Massachusetts area.

YOUR FIRST HOME: LET THE BUYER BEWARE

The scenario goes like this: A Buyer decides to buy a home. The Buyer finds a real estate broker. The broker shows the Buyer many different properties and the Buyer finds the home of his or her dreams. The broker, sensing the Buyer's enthusiasm, has the Buyer sign a document called an Offer to Purchase. The Buyer thinks to himself or herself, should I sign the document? Should I seek legal counsel? What does this all mean? Or, the Buyer may not even consider the legal consequences of what he or she is signing. What is the Offer to Purchase?

THE OFFER TO PURCHASE

The Offer to Purchase is a binding contract which the prospective buyer signs when buying real estate. It is basically the contract which governs the deal. It may be represented to the Buyer that it is not binding because buyer and seller must also execute a second contract known as a Purchase and Sale Agreement. However, recent Massachusetts case law holds to the contrary. Remember, the Sales Broker represents the Seller and only acts in the best interest of the Seller. The Buyer will also be asked for an earnest money deposit to show good faith usually in the amount of $500.00 or $1,000.00.

PURCHASE AND SALE AGREEMENT

Once the offer has been accepted by the Seller, the parties will then be required to execute a formal document called a Purchase and Sale Agreement. This agreement contains the details of the transaction. A buyer must be very careful when signing this document because of all of the legal pitfalls. Also, the Buyer will be asked to make another sizeable deposit of between 5% and 10% of the purchase price. The Buyer should beware of the amount of the deposit because if the Buyer wants to walk away from the deal for any reason, the Buyer risks losing that deposit (if not more) as liquidated damages.

THE MORTGAGE

The next step in the process is securing a mortgage. There are many different lenders with many different programs to assist a Buyer in obtaining financing. The Buyer's loan officer will be able to assist him or her with that.

CLOSING

The next step is closing. This is a meeting where the parties come together and sign all the necessary documents to facilitate the transaction. The seller will tender a deed and keys, and the buyer will sign all the mortgage documents and pay over the purchase price to the seller.

As the Buyer, you will be asked to sign a myriad of documents. One must be very careful of what they are signing. The Broker or bank's attorney may say that "Well, unless you sign, the bank will not lend you the money." Don't believe it. Many times a bank will attempt to slip a document past the Buyer or even charge you for something the bank agreed to pay. It is always a good idea to have an attorney with you from the very first step of the buying process. Also, beware of real estate brokers who refer Buyers to an attorney. Remember, the broker will not refer attorneys clients to the attorney if the attorney's advice to the client is contrary to the interests of the Seller or broker. The best thing to do is retain independent counsel of your own choice.

Most times the purchase and or sale of real estate goes smoothly. However, there are times that is not the case. A buyer or seller should always have competent legal representation throughout this tedious process. Remember, "there's never a problem until there's a problem."

While the information presented in this fact sheet is accurate as of the date of publication, it should not be cited or relied upon as legal authority. It should not be used as a substitute for reference to Massachusetts and Federal law, both of which may be reviewed at local law libraries. Finally, this fact sheet should supplement, not be a substitute for, advice of competent legal counsel.

To contact our Boston Real Estate Lawyers, call today at 800-975-5346 or email us.