Real Estate

The purchase and/or sale of real estate are one of the largest financial decisions a person makes in his or her lifetime. I take great pride in guiding each client through every aspect of the real estate transaction. One of my goals is to make the process as easy and stress free as possible.

Over the past 30 years, I have represented buyers, sellers and lending institutions in residential and commercial real estate transactions. My expertise includes private residences, multi family dwellings, co-operative apartments, condominiums, refinancing of mortgages, new constructions and construction loans. My focus in every real estate transaction is to get the deal done while protecting and serving my clients.

Other legal services I offer related to real estate are deed transfers or transferring how property is held without selling it, such as a gift to a family member, creating a life estate interest, transferring the property into a trust and LLC or adding or removing someone from the deed.

Please contact my office if you have any specific questions concerning your real estate transaction.

FAQS

It is not a requirement to have an attorney, but it would be foolish not to have one. As a purchaser of real estate you will be signing a Contract of Sale and Rider prepared by the Seller’s attorney. There are many clauses in the Contract of Sale that the average non attorney does not understand and which can adversely affect them. An experienced real estate attorney will review the Contract of Sale and Rider and make proposed modifications to the Contract for the benefit of his client, the purchaser. The lawyer’s job is to advise and protect his or her client prior to the signing of any documents from the Contract of Sale to the Closing.

After you have made an offer that has been accepted you should retain a real estate attorney to review the Contract of Sale. Remember, once you have signed a contract, your rights and obligations concerning the transaction are fixed and your attorney may not be able to nor have the opportunity to re-structure the contract to meet your objectives.

A “pre-approval” is a conditional mortgage loan approval issued by a lender before signing the contract of sale. It is always wise to obtain a pre-approval. It shows the seller that you are a qualified buyer and also gives you an opportunity to discuss your financial situation with your banker or mortgage broker. This will help you determine what type of loan you can qualify for and afford. The website www.safeborrowing.com is a great resource for buyers who will be taking a mortgage to purchase their home.

If there is a real estate broker involved in the deal, then the broker should obtain your lawyer’s contact information and provide it to the seller’s attorney. If there is no real estate broker(s) involved then give your lawyer’s contact information directly to the seller. The seller’s attorney will then send a Contract of Sale to your lawyer.

Yes. You should obtain the services of a New York State licensed professional engineer to evaluate the structural integrity, electrical, and/or mechanical systems of a house prior to purchase. Most companies will prepare a comprehensive report of the results of their inspection. This will aid your decision whether to purchase the house, reveal if there are any toxic or dangerous materials such as asbestos which must be safely removed and/or negotiate a reduction in the purchase price based upon the condition of the structure. It is a worth while investment.

Yes. Few sellers will enter into a contract without receiving a down payment from the buyer.

The down payment is typically 5 to 10% of the purchase price and paid to the seller, but can be negotiated. The down payment gets deposited into the seller’s attorney’s escrow account and remains there until the closing when it gets credited toward the purchase price.

A seller’s concession is when the seller agrees to increase the purchase price, usually up to 6% of the actual purchase price, so that the buyer/borrower can obtain a larger mortgage to help pay for the buyer’s closing costs. The concession amount gets credited at the closing, meaning the seller does not actually receive the amount over the actual purchase price. This is something the seller has to consent to and the buyer must obtain approval of their lending institution to permit the concession.

A written indication by a lending institution that it will grant a mortgage on real property in a certain specified amount and on certain specified terms such as interest rate and duration of the loan including an expiration date as to when the loan must close.

No, provided the contract contains a “mortgage contingency clause”. Most contracts contain what is called a mortgage contingency clause which gives the buyer a certain amount of time to obtain a mortgage or loan “commitment” from the bank. If the commitment is not obtained within the time period, then the buyer or seller can cancel the contract and the buyer’s down payment must be refunded.

If there is no mortgage contingency clause in the contract, the down payment is at risk and may be forfeited to the seller should the buyer fail to qualify for a mortgage.

Title Insurance offers the buyer/new owner (insured) indemnity against loss in the event that there is a problem with the title, such as prior mortgages, other liens or encumbrances, encroachments, fraudulent transfers, and any other defects in the title in which the insured will have an interest. The title company will also defend the insured against any adverse claim based on a defect in title covered by the policy.

Yes. An examination of the sellers’ title to the real property being sold in an absolute must for the protection of the buyers. It is important before you purchase real estate to establish clear title since if you do not, you may have a problem later on if you wish to sell or mortgage it. Owner’s title insurance is not legally required, however, a buyer of real property would be foolish not to purchase an owner’s title insurance policy. For a more in depth discussion see

http://www.nytimes.com/2000/07/16/realestate/your-home-the-need-for-title-insurance.html

Once a fully executed contract (signed by all parties) is received by the buyers’ attorney, he will order the title report. Your attorney can advise you on what type of title insurance to get and whether it covers you for all expected contingencies. Further, your attorney can advise you on the terms, exceptions, and conditions of the title insurance policy. It is important to realize that while title insurance may give you some protection against financial loss, it does not lessen the importance of having an attorney.

Title Insurance is different from future risk type insurances such as life insurance and liability insurance. These insurances deal with future risk of dying and accidents. Title insurance covers present risks to real property and protects the buyers up to the dollar limits of the policy against the risks at the time the title policy is issued.

Yes. The bank or lending institution will also require the buyers/borrowers to purchase mortgage loan title insurance guaranteeing and insuring the lending institution that there present mortgage loan will not be jeopardized by prior mortgages, liens and encumbrances, fraudulent transfers and any other defects in title.

The Closing is the meeting between the buyer, seller and lender at which the property and funds formally change hands.

Every transaction is different, but generally the process takes 60 to 90 days. Co-Op transactions may take longer because there is an additional step of obtaining co-op board approval of the buyers.

Closing costs are the expenses incurred by the buyers and sellers in the purchase and sale of real property or by the owners in refinancing a house. These may include the origination fee, points and other bank fees, mortgage broker fees, taxes, title insurance, cost of a survey, transfer fees, recording costs, public record searches, mortgage tax, real estate broker’s fees, attorney’s fees, escrow for taxes and homeowner’s insurance.

Yes. A Seller has to pay to the State of New York four dollars ($4.00) per thousand on the sale price. For example, if you sell your home for $500,000.00, then you would have to pay $2,000.00 (500 X 4) in NYS transfer tax.

Yes. A Seller has to pay the City of New York a transfer tax of 1% of the sale price for a 1-3 Family Residential House, Condo or Co-op Unit if the sale price is $500,000.00 or less and 1.425% if the sale price exceeds $500,000.00. For example, if the same $500,000.00 house was located in the City of New York, the seller would have to pay an additional $5,000.00 to NYC in transfer tax. If the same house sold for $550,000.00, then the seller would have to pay $7,837.50 in transfer tax to the City.

The mansion tax is an additional 1% transfer tax on the sale price imposed by New York State on the Buyer or Grantee on all 1, 2, and 3 family dwellings including Condos and Co-op Units with a sales price of one million dollars $1,000,000.00 to
$1,999,999.00. The New York State Real Estate Tax rates on residential properties have increased as follows for transfers with a date of conveyance of July 1, 2019 or later (except if the Contract was executed on or before April 1, 2019) for properties located in New York City: $2,000,000 – $2,999,999, 1.25%; $3,000,000.00 – $4,999,999.00, 1.50%; $5,000,000.00 – $9,999,999.00 2.25% and continues upwards in increments of $5,000,000.00 to $25,000,0000.00 where the maximum mansion tax rate is 3.90% on the sale price.

A flip tax is an additional transfer tax imposed by a Co-op or Condo on the Seller of the Unit. It is usually based upon a percentage of the sales price but for a Co-op Unit it can also be based upon a dollar amount per share of the shares attributed to the Unit sold. This is a way Condos and Co-ops generate money for major repairs and maintenance without having to raise common charges or maintenance.

Yes. Its 1.425% when the sale price is $500,000.00 or less and 2.625% when the sales price exceeds $500,000.00

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