Suffolk County Real Estate
For many people in Suffolk County, the purchase of a home is among the most important and expensive financial transactions of their lives. There are many important decisions to be made beyond which home to buy. The decisions you make regarding the purchase of your home can affect the type of mortgage you get, your interest in the property, the way you use your property, the true total costs of the property, and many other matters that can affect you and your family well into the future. If you are buying property, you should consult the experienced Suffolk County real estate attorneys at Pulgini & Norton for advice and representation.Buying and Selling Residential Real Estate
Important aspects of your real estate transaction include the terms of the offer and the purchase and sale agreement. You want to make sure that these contracts include the appropriate contingencies, in case a home inspection turns up defects or you are unable to obtain a mortgage. In many cases, buyers make an earnest money deposit to the real estate seller when they make offers on real estate.
Earnest money deposits of 5% of the property's purchase price are customary but not necessary. They are made to show that you have good faith as a buyer and plan to go through with the purchase. Often, the deposit is split so that some is placed in the account with the offer, while the balance is put into the account at the time of the purchase and sale agreement.
Usually, you put the money into an escrow account, and it is held jointly and made payable to the broker or attorney who holds the escrow account or another escrow agent. The escrow agent owes significant fiduciary duties to you, the seller, and sometimes the lender. These duties, which include a duty not to self-deal and a duty of loyalty, persist until the funds are disbursed to the appropriate parties.
The offer or the purchase and sale agreement will specify whether the earnest money deposit should go into an interest-bearing account. If it goes into an interest-bearing account, the agreement should also indicate who gets the interest. It must go into an account that is beyond the reach of the escrow agent's creditors. The purchase and sale agreement may also include a liquidated damages clause. This usually allows a seller to keep your earnest money deposit as liquidated damages if you default on the purchase. Sometimes this clause may allow the seller to recover other damages.
Although a liquidated damages clause may seem harsh, it can be useful because it limits the damages that a seller can recover in case you are unable to locate a lender. If there is no liquidated damages clause, the seller cannot keep the earnest money deposit in the event of your breach. However, if it suffers substantial damages due to the breach, the seller may try to recover the full scope of its damages from you. After you have signed the purchase agreement, you become the equitable owner of the home.Contact an Experienced Suffolk County Attorney for a Real Estate Matter
If you are considering buying or selling a home, or you are a lender providing a mortgage for a property, the Suffolk County real estate lawyers at Pulgini & Norton can offer knowledgeable advice, counsel and representation. Call us at 781-843-2200 or contact us via our online form for a free consultation with a property transaction attorney.