If a real estate broker has been involved in your New York real estate transaction, that person will usually give the attorneys a binder or deal sheet. This allows the attorneys to communicate with one another.
Things are different in New York when compared with other states. Before entering into a contract, the engineer’s inspection is typically performed in New York. After this has been obtained and the parties have agreed to any repairs to be made by the seller or price reductions, the attorney for the seller then puts together the contract of sale. This must be reviewed by the purchaser’s attorney as well as the parties intending to purchase.
The terms of the contract may need to be negotiated at this stage, depending on whether or not everyone can come to an agreement. After this point, both parties will sign and the down payment is deposited in the escrow account with the seller’s attorney. This is handled until termination of the contract or until closing. There is an exception to the typical rules in a real estate transaction because a mortgage contingency clause will usually be included in the paperwork, that gives a specified period of time such as 45 days to get a written commitment from the mortgage company for the amount wished to finance.
This is true with one exception of cash deals. If the purchaser cannot get a mortgage commitment within this clarified time period, they can ask for an extension to get financing. However, if the seller does not agree to an extension or if the purchaser is outright denied on the mortgage application, the down payment is returned to the purchaser and the transaction is canceled in full. After all conditions on the loan have been satisfied once the purchaser has obtained the mortgage commitment, the parties can move to closing. It can take a couple of months to get to the closing point if financing is involved. Before closing, the purchaser’s attorney needs to order a title report. This is then reviewed by the sellers, the lender’s attorneys and the purchaser’s attorneys.
Any title issues will need to be addressed promptly in order to minimize future legal problems. If you are thinking about buying or selling real estate in New York, it is in your best interests to have the services of an experienced attorney at your side for the duration.