Residential real estate transactions in Arlington Heights, Illinois, have many complex laws. Whether you’re buying, selling, or renting a property, it’s crucial to be aware of common legal issues that arise in real estate transactions law and how to avoid them.
Contract Law in Residential Real Estate Transactions
One of the most common issues that people face is with the contract, whether it’s a purchase contract or another type of real estate contract. It’s important to ensure that your contract is valid and complies with all relevant real estate transaction laws.
What Is Considered a Valid Contract?
A valid real estate contract outlines the agreement between the buyer and seller. It typically includes details such as the location of the property, the terms under which the contract is valid, the purchase price, and other relevant information.
For a contract to be valid, both parties must be in agreement on the terms. Both parties must also be legally competent and allowed to enter into such a contract.
The contract should include the following information for it to be fully valid:
- The names and details of both parties
- The details of the property, including its location
- The amount of the earnest money deposit
- All relevant disclosures as required in Illinois
- Any other terms and conditions that must be met
For example, if the property has paint that contains lead, it must be disclosed in the contract. Furthermore, other terms can be agreed upon. For example, both parties can stipulate that the contract only be valid if a third party inspects it and finds no structural damage.
The contract must also be in writing, and both parties must affix their signatures. Do not, under any circumstances, enter into an oral agreement with the other party.
Disclosures and Due Diligence in Real Estate
As mentioned, the contract must include any required disclosures as per the Illinois Residential Real Property Disclosure Act. If the seller refuses to provide a disclosure report, the buyer has the right to terminate the contract.
What Are the Seller’s Disclosure Obligations?
Here are some of the things the seller must disclose in the disclosure report:
- Lead-based paint or pipes
- Radon or asbestos-based hazards
- Material defects in the electrical system, plumbing system, sewage system, HVAC, or structure
- Issues with flooding or leakage
- Unsafe drinking water
- Termite infestations
Note that this is not a complete list. If you’re selling a property, it’s crucial that you seek the assistance of a real estate lawyer to ensure you are not failing to disclose something that is required by law.
Tips to Avoid Common Pitfalls in Residential Real Estate Transactions
Whether you’re planning on buying or selling a house, real estate lawyers in Arlington Heights can review the contract and ensure the transaction is smooth.
If you’re purchasing a property, make sure you complete the home buying checklist, which includes assessing your financial readiness, finding the right real estate agent, and conducting a home inspection.
Real estate agents usually charge a percentage of the sale as a commission. While most of the commission is charged to the seller, some agents also charge the buyer a small commission, so make sure you are aware of the agent’s fees before hiring him or her.
A home inspection is critical, as it allows you to uncover flaws and defects in the property. While you may still be willing to purchase the property, these defects can be a bargaining point to help you secure a better price on the home.
If you’re selling a home, you must ensure you disclose everything that’s required by law. Failing to do so could result in losing the sale. It’s best to hire a home inspector to check for hidden defects that you may need to disclose.
How a Real Estate Lawyer Can Help You
Whether you’re buying or selling a home, a real estate attorney can ensure that the contract has all the necessary disclosures. If you’re buying a home, there may be some terms you want to stipulate for the contract to be valid; an attorney can ensure these terms are properly worded.
Your lawyer can also review the title and ensure the seller has a clear title to the property. You need to make sure there are no liens on the property that may preclude you from obtaining full ownership.
If you are taking out a mortgage on the home, there may be additional documents required. An attorney can help you prepare those documents and ensure your mortgage application goes through without complications.
If you are involved in a cash transaction, having an attorney will ensure that the proper escrow process is followed, the transfer of money goes smoothly, and all relevant documents are present. If necessary, an attorney can help ensure proof of funds on the part of the buyer.
An attorney can also help with the purchase and sale of small businesses, which comes with its own laws and regulations. In addition, a lawyer can help with estate planning involving real estate.
However, it’s important to know the right questions to ask when hiring a real estate lawyer. Make sure the attorney is licensed to practice in Illinois and has experience dealing with your kind of cases. An attorney with a good track record will be able to point you to reviews or referrals.
You should also ask for an initial consultation, during which you should inquire about attorney fees. You should also ask who will be working on your case; in law firms with multiple partners, you will want to know who the lawyer assigned to your case is if it is not the person you are meeting.
