Buying real estate can be a somewhat complex process. People have to screen numerous properties to find options that fit their needs and their budgets. They have to make an offer and negotiate with the seller. They also have to finalize a mortgage and sign all of the necessary paperwork.
People hoping to buy real property, especially those making their first-ever purchases, may encounter surprise complications for which they have no plans. What types of issues may arise and complicate a pending residential real estate transaction?
Pre-existing leases
The prior owner of the property may have treated it as a source of income rather than a primary residence. There may be tenants living at the property currently. In that situation, the buyer generally has an obligation to uphold the existing lease. They need to review the lease terms to see how long it lasts and what processes may be necessary for them to take possession of the property.
Property issues that diminish value
There may be a number of issues with the property that significantly diminish the fair market value and usefulness of the property. Reviewing disclosures can help buyers look into the extent of known issues when they attend an open house or schedule a viewing.
Buyers and their agents often need to look for signs of particularly costly property issues. Foundation problems, water incursion, active/recent infestations, failing plumbing, problem windows, aging electrical wiring and HVAC issues are among the most costly property concerns that require careful consideration.
Surprise defects found during inspection
Sellers generally have to disclose any significant physical defects with the property. Most people want to protect themselves from liability and make thorough disclosures about all known issues with their homes when listing them.
However, the inspection process may turn up latent defects that the current owner may not have identified previously. In such circumstances, buyers have to consider the cost of addressing the issue and whether the defects affect their desire to acquire the property.
The buyer may need to renegotiate with the sellers to reduce the price or arrange for repairs prior to the closing. Other times, they may need to cancel the closing because the defects change their opinion of the property’s suitability.
The people preparing for real estate transactions and the professionals assisting them may need help navigating surprise issues that might arise. Having legal insight and support can make it easier for buyers and their agents to effectively address issues that threaten to derail a residential real estate transaction.