Buying and Selling Residential Real Estate in New York
In New York, the buyer, seller and lender are each typically represented by independent counsel at the closing. By contrast, in some states, such as California, parties to the closing rely upon escrow agents to complete the closing.
In New York, the seller’s attorney is responsible for reviewing and approving the contract for the sale of the property; preparing the new deed to the buyer; reviewing the title report to make sure the seller’s title is or will be ready to be transferred free of all liens and encumbrances; procuring pay-off balances for the seller’s mortgage(s); preparing a closing statement; in some cases, negotiating the details of the contract; and at the closing, reviewing documents and closing funds.
The buyer’s attorney must review and approve the proposed deed; review the title report and ensure the buyer acquires marketable or insurable title (depending on the contract); assist the buyer in determining that the intended use of the property is legally permitted under applicable local land use and zoning regulations, that the property has been lawfully subdivided, that the premises may be lawfully occupied as a residence (and in some cases a home business or professional office), and whether the premises are in a flood hazard zone, which may severely restrict the ability to make physical improvements to the property; instruct the buyer as to the required funds for the closing; guide the buyer through inspections of the property and the mortgage application process, if necessary; counsel the buyer about the importance of obtaining a current survey and title insurance, and explain what an owner’s or “fee” title insurance policy covers as well as the standard exclusions from coverage; and at the closing review all documents and funds on behalf of the buyer.
Realtors in New York act on behalf of the seller and/or buyer, depending on the situation. Often a realtor will help the buyer set up property inspections, including structural, water quality and flow, septic, pest, radon and the final pre-closing inspection, among others. Buyers should also consider inspections for mold and underground fuel storage tanks, and if there might be environmental contamination issues with the property.
Buying a home is the largest and most important financial transaction that most people will undertake in their lives. It is exciting and nerve-wracking, but should be a positive experience.
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