Tips on How to Reduce Risks in Common Real Estate Transactions
Individuals and businesses commonly participate in real estate transactions. You may purchase or sell a home. Your company may purchase commercial property, may buy undeveloped property, or may lease a space for operation. There are often risks involved in making real estate purchases. Owners and others must learn how to reduce risks in common real estate transactions.
Evaluate the Real Estate Transaction
No matter how much you may want to complete a specific transaction, it may simply not be a good idea. When considering any transaction, look at it with as much objectivity as possible. You may want to have the situation reviewed by a professional in order to obtain as much detail as possible. Consider having the property appraised by an independent appraiser prior to entering into negotiations. This may eliminate some ambiguity or misconceptions about the value of the property. If you have a prospective buyer identified, you may wish to discuss sharing the cost of the appraiser to move along the negotiations.
Have the Terms of the Sale Negotiated or Reviewed by a Professional
Sellers in a real estate transaction typically have a real estate agent and possibly an attorney reviewing the terms of the agreement before presenting the agreement to the buyer. While the listing agent is not required to inspect the property, the seller has a duty to disclose known defects. Buyers are often at a disadvantage because of the superior knowledge in the hands of the seller, especially in terms of the condition of the property. Consider having a real estate agent or attorney to review the terms of the agreement before finalizing.
What Must a Seller Disclose
A seller in Arizona is required to disclose material facts about the property. Material facts are those effecting the value of the property. A seller is also required to disclose certain information only if asked. However, sellers are not required to disclose some information regardless whether the buyer inquires. For example, a seller need not disclose is the property was the site of felony or was occupied by an individual with certain communicable diseases. Sellers also are not expected to disclose what they could not reasonably have known, e.g., the existence of an underground water leak. This does not mean, though that a seller can “turn a blind eye” to the condition of her property. A failure to disclose known defects may affect the enforceability of the sales’ agreement.
Thoroughly Review the Contract Before You Sign It
A contract is the legally binding agreement between parties in a business transaction. Before you sign the document, be sure to read it thoroughly. If you have any questions, be sure to ask. Some terms of the contract may not be beneficial or fair to you. Have an experienced attorney review the contract and request any changes if necessary. Make sure you keep a copy of the document in case action is necessary later.
There are often risks to both parties in real estate transactions. Get the legal help you need before you agree to a contract. Call the lawyers at Udall Shumway PLC to schedule a consultation.
This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice regarding Risks in Common Real Estate Transactions, or any other litigation issues, please feel free to contact us at 480.461.5300, log on to udallshumway.com, or contact an attorney in your area. Udall Shumway PLC is located in Mesa, Arizona and is a full service law firm. We assist Individuals, families, businesses, schools and municipalities in Mesa and the Phoenix/East Valley.