Free Massachusetts Real Estate FAQs | Free Massachusetts Real Estate Legal Documents

Does The Sale/Purchase Become Final When We Signed The Purchase And Sale Agreement?

Tue, 29 May 2007 21:19:00 GMT

Not yet. First, the terms of the purchase and sale agreement have to be performed by each of the seller and the buyer. The offer to purchase and/or the purchase and sale agreement define those obligations and, in great measure, determine the rights and obligations of the parties up to the date of the closing and, in many cases, beyond that date. As an example, the title search is typically done by the buyer together with a home inspection and survey of the property. The title to the property determines whether or not the seller has the ability to convey a good, clear, and marketable title. The home inspection determines the condition of the property, and the survey of the property gives a rough idea of whether or not the building encroaches on other property or if other property encroaches on the property someone is buying. The issue really comes down to whether or not the buyer, or the seller, who are typically untrained professional in the real estate business or even a lawyer with training in the business, should be represented by counsel to protect their interests. The saying "He who represents himself has a fool for a client" is especially appropriate in real estate transactions. The sale of a property is straight forward until you have a problem. If the documents fail to deal with your problem then your ability to protect your interests, whether you're the seller or the buyer can be seriously compromised. The bottom line is that the deal isn't a deal until the deed is recorded and, even then, there can be lasting reminders of a bad deal in the form of a law suit. Once the purchase and sale agreement is executed, except very specific circumstances, it is very difficult to avoid your promise to sell/buy without potentially significant consequences.

Why Should I Spend The Money For A Home Inspection When My Mortgage Company Is Going To Inspect The Property?

Tue, 29 May 2007 21:19:00 GMT

According to one area broker/owner of a realty office, the chief confusion for consumers these days is that many believe an appraisal and a home inspection are the same thing. However, appraisals are used to determine the market value of the house you are going to buy which is the figure on which the mortgage lender bases its decision about the money it can safely lend you. When you obtain a home inspection you are evaluating your investment. Home inspectors, acting on behalf of who retained them, search for possible physical defects with the structure, roof, basement, mechanical equipment such as heating, air conditioning, electrical systems, sewage, plumbing, exterior drainage, and check for termite and other wood destroying insect infestation and/or damage.

The offer to purchase or the purchase and sale agreement controls the buyer's right to make these inspections, the time within which they must occur, when and how the findings must be exchanged, and the sellers obligations to correct discovered defects. The offer to purchase and the purchase and sale agreement typically allows buyers to terminate the agreement unless the seller makes the required repairs. It also usually permits sellers to cancel the contract if an inspection for infestation and/or damage by termites or other wooddestroying insects reveals a treatment or repair problem exceeding a certain amount of money (or the buyer can accept the property with a credit for the previously agreed amount).

Thus, not only are home inspections much different than the appraisal a mortgage company obtains, but they must be handled with particular care in light of the effect they may have on the anticipated sale of the property.

What Happens If We Can't Get A Mortgage After We've Signed The Agreement Of Sale And The Inspections Are Completed?

Mon, 04 Jun 2007 21:51:22 GMT

The first step to homeownership should be to get preapproved (not just prequalified) in writing for a mortgage. As a buyer, it defines your price range and could save you needless visits to homes you cannot afford. From the seller's perspective, it takes some of the worry away and makes the potential buyer more attractive thereby increasing the chances of a successful and amicable negotiation.

If a mortgage commitment is not delivered by a specified date or any extended date permitted by the seller the contract may be but not necessarily is deemed null and void. The agreement has to be very specific on this issue. Generally there is an obligation on the part of the buyer to notify the seller and/or broker that they cannot get financing. That is generally done in writing with proof of delivery in the form of certified mail or even fax transmission. In that event, the buyers deposit monies are usually returned unless the failure to obtain the mortgage was the result of something the buyer did or did not do. It must be noted however, that mortgage commitments usually contain contingencies and are not guarantees that the funds will be made available at the time of closing. For example, if you unexpectedly became unemployed the mortgage company would not likely lend you the previously pledged cash and, unless this event was specifically addressed in the agreement, you risk losing your deposit monies.

We're Buying A

Tue, 29 May 2007 21:19:00 GMT

Massachusetts has very little in the way of protections against parties who buy "fixeruppers". We have a law that requires that there be smoke detectors installed and that a smoke detector be obtained. We also have a law that requires that there be a working septic system under our Title V law. If you buy a property "as is and where is" without any warranties or representations whatsoever then you better be prepared for the onslaught of problems that can exist with any type of "fixer upper". Be prepared to deal with local building, health, zoning, and various other municipal departments that will undoubtedly take a great interest in your purchase. I generally recommend that my client have me review the "building jacket" at the city or town to determine if there are any outstanding health and/or building code posted violations. As a matter of fact it is better to do this even if you thing every thing is wonderful with the property you are about to buy.

What Happens At The Closing?

Tue, 29 May 2007 21:19:00 GMT

Massachusetts recognizes that lawyers and not closing companies or title companies are qualified to do real estate closings. Thus, in the vast majority of cases a lender is represented by an attorney. Generally it is the duty of the attorney to protect the interests of the lender and not the borrower and certainly not the seller. In many instances the lender's attorney also represents the buyer as both the lender and the buyer have similar, yet different issues and objectives. The lender wants a good clear first mortgage on the property and the buyer wants a good, clear title to the property. It is for that reason that lawyers can and do represent both the buyer and the lender. It is a conflict of interest however it is a conflict of interest that both the buyer and lender can waive so long as the attorney has properly explained the conflict and so long as the attorney can see no existing conflict. However once a conflict develops the attorney must step aside. It is taboo for the attorney to represent the seller in that situation. Sellers are typically represented by their own counsel or not at all. At the closing the lender's attorney has already conducted a title examination, obtained a survey, and a municipal lien certificate from the town showing any outstanding taxes owed. The lender's attorney prepares the HUD settlement statement showing how much each of the parties have to bring to closing (as in the case of the buyer) and how much they will get (as in the case of the seller). At my last closing I determined that a buyer signs his/her name an average of thirty eight times to documents ranging from the HUD settlement statement to the document that says that you'll sign other documents in the event that they need it after the closing. By and large the important documents are the note, mortgage, deed, and HUD settlement statement. The note evidences the debt; the mortgage (Latin definition: Death Grip) secures the real estate to the note in case you don't pay; the deed transfers title; and the HUD settlement statement tells you how much you're going to pay for the "piece of the rock". Once all of these documents are signed, the attorney runs down the title from the date of his examination to the date, hour, and minute of the recording and then puts the documents to record. And Bingo...you're a home owner who has fulfilled the American dream. You will be offered title insurance as buyer. Take it..its good for you. If you don't and there is a title problem Attorney So and So may not be around to stand behind their work even though they certified the title to you.

What Are Comprehensive Permits, And How Are They Used To Create Affordable Housing?

Tue, 29 May 2007 21:19:00 GMT

A comprehensive permit is issued by a municipality to a developer who proposes to build housing in which at least 25% of the units are affordable to lowincome residents. A comprehensive permit is an allencompassing permit which subsumes all permits and approvals normally issued by other local boards. A comprehensive permit typically allows a developer to build at a higher density than is normally allowed under a town's zoning laws. For more information contact DHCD's department of private housing at 6177277824

How Does Dhcd Differ From The U.S. Department Of Housing And Urban Development?

Mon, 04 Jun 2007 21:51:22 GMT

DHCD is a state agency, and HUD is a federal agency. Both agencies are concerned with public and assisted housing as well as community development. In many instances, DHCD administers programs and funds on behalf of HUD. Also, there are several state programs that are very similar to federal programs. Some of the more common federal programs are Section 8 rental assistance, Community Development Block Grants and Community Services Block Grants. Some examples of similar state programs are the Massachusetts Rental Voucher Program (similar to Section 8 but funded with state dollars) and Community Development Action Grants (similar to block grants but funded with state dollars). Depending on your question, try to determine whether you are asking about a federal or state program before you pick up the phone. For access to HUD, try http://www.hud.gov/

What Resources Are Available To Developers Of Affordable Housing?

Tue, 29 May 2007 21:19:00 GMT

A variety of resources are available to stimulate the private production of affordable housing. These include the Low Income Housing Tax Credit Program, the HOME program, the Local Initiative Program, the Housing Stabilization Fund and programs run by quasipublic agencies. Contact the Division of Private Housing at 6177277824 for more information.