If you’re buying a home, a condo, or a multi-family property in NYC, the real estate closing process can be long and complicated, necessitating the expertise of a closing attorney. A real estate attorney handles the transaction, and a variety of documents are prepared, including title insurance policies, home inspection reports, and tax transfer documents. In addition, closing costs are typically paid at the closing by the buyers and sellers. These fees include title insurance, recording charges, lawyer fees, home inspections, and escrow fees.
After an initial offer and counter-offer phase, the buyer, seller, and real estate agent agree on the basic terms of the sale. These terms can be set forth in a one-page offer form, and they will usually include the price offered, whether the purchase is contingent upon obtaining a mortgage, and any items that are included or excluded from the sale. It is crucial at this stage to have a closing attorney review the terms to ensure everything is in order.
Then the process moves to the lender to prepare the mortgage package and obtain a commitment letter. The lender will need to review the appraisal, and often the loan is subject to a credit approval and underwriting review, which takes some time. In the meantime, the buyer is preparing for closing by gathering documentation for the bank and by completing a board application (if buying a co-op or condominium) or submittal of a rental agreement (if buying a single family home). A closing attorney plays a vital role in coordinating these efforts.
Once the mortgage has been approved and a commitment letter issued, a closing date can be scheduled. In the state of New York, a closing typically takes 60 to 90 days from the date of the contract. The buyer will send a down payment to the seller’s attorney, which will be deposited in an escrow account. During the seventy-two hour attorney review period, changes can be made to the contract, and either party can walk away from the deal during this time. A closing attorney ensures that all necessary adjustments are made during this critical time.
There are a number of things that can thwart the closing process, from unexpected title issues to a buyer and seller dispute about items left behind. These can delay the closing by months, and they may even prevent a real estate transaction from completing at all. In such cases, a closing attorney can help resolve disputes and facilitate a resolution.
Buyers must be careful to ensure they bring certified funds or cashier’s checks in the correct amounts to the closing. This includes the share of the closing costs, including home inspection and escrow fees, as well as city and state transfer taxes.
It is also important to remember that a final walk-through will be done before the closing takes place, and buyers should make sure they’re happy with the condition of the property and that all required repairs were completed. Finally, it is usually a good idea to get the mortgage interest rate locked in as early as possible in the process. Market fluctuations can cause the mortgage interest rate to increase, and this can have long-term financial implications for a buyer.
As a general rule, the real estate closing process will go smoothly if everyone involved works together. However, it is always a good idea to discuss your options with a closing attorney experienced in New York real estate early in the transaction to ensure that your interests are protected throughout the process.
A Closing attorney plays a crucial role in the real estate transaction process in New York, ensuring that the process of buying or selling a property goes as smoothly as possible. This includes drafting and executing real estate documents, reviewing the terms of contract, and assisting with negotiations. They also oversee escrow accounts, assuring that funds are disbursed properly and that all financial obligations are satisfied.
The process of purchasing or selling real estate involves many intricate steps and procedures that can be difficult to understand. This can result in misunderstandings or even mistakes that could lead to legal complications. A closing attorney can help to simplify complex legal documents and contracts, ensuring that they are easy to understand and accurately reflect the parties' intentions. They also play a vital role in minimizing risks and advising their clients on the best course of action.
When purchasing a home or commercial property, there are often numerous documents to sign, locking the buyer into a lengthy and financially considerable contract. The closing documents may include a purchase agreement, mortgage forms, deed, and other affidavits. A closing attorney is essential in this part of the process as they ensure that all documents are thoroughly reviewed, accurate, and comply with New York state law and regulations.
During the closing process, there will likely be several people present, including the buyer and seller, their respective attorneys, a representative of the title company or a settlement agent, and one or more real estate brokers. Depending on the type of loan, the mortgage company may also be in attendance. A closing attorney ensures that all legal documents are explained clearly to everyone present, providing clarity and resolving any potential misunderstandings.
Once all of the financial aspects have been finalized, the closing attorney takes on the responsibility of transferring ownership of the property by preparing and recording the deed. This is a crucial step for establishing a clear chain of ownership and ensuring that the buyer legally acquires the property.
The process of buying or selling a property in the State of New York can be complicated and time-consuming, necessitating the expertise of a skilled and experienced closing attorney. They ensure that the transaction process is seamless, all deadlines are met, and all necessary steps are taken diligently. Furthermore, a closing attorney is instrumental in resolving any disputes that arise, ensuring a smooth transition of property ownership and helping to mitigate potential legal issues.
Closing costs can be a big surprise for buyers and sellers, and a skilled closing attorney can help navigate these expenses. In New York, both parties are responsible for closing costs which can add up to 10% of the sale price of the property. Understanding what these costs entail and how they can be managed is crucial for a smooth transaction.
In NYC, buyer closing costs include:
Lawyer fees: Most residential sales in NYC require a transaction attorney to review the purchase contract and work with your title company to close the deal. Typically, attorneys charge an hourly rate or a flat fee depending on the complexity of the transaction. A closing attorney ensures all legal aspects of the deal are managed effectively.
In addition to reviewing the purchase contract, your attorney will also assess the financial health of the co-op or condo building where you’ll be living. This is called a financial statement and is very important for your overall peace of mind. Lastly, your attorney, acting as your closing attorney, will assist you with the closing by reviewing and signing documents and coordinating the closing with the seller’s attorney and your bank.
Escrow and title insurance: Your real estate attorney will work with a reputable title company to handle the closing. The title company acts as a neutral third party and will hold the funds in a third-party escrow account until the final closing. The role of a closing attorney here is crucial as they ensure all transactions and documentation are conducted properly.
Other miscellaneous fees: Your closing will include other fees such as filing and recording fees, survey costs and notary fees. Typically, these fees are not significant but do add up at closing. These additional costs underscore the importance of having a closing attorney to guide you through the process.
Some of these fees are unique to NYC and some are only applicable for certain types of properties such as co-ops, houses or new developments. For example, the Mansion Tax and Mortgage Recording Tax apply only to condos and houses over $1 million but not co-ops while title insurance only applies to real estate purchases and not coops.
For sellers, the biggest closing cost is typically the broker’s commission which can be negotiated down by working with a real estate brokerage that rebates some of their commission to their clients.
Closing costs can add up quickly so it’s best to be prepared when purchasing a home in NYC. Utilizing the services of a closing attorney can provide clarity and assist in managing these costs effectively. They can offer valuable advice and ensure that all legal requirements are met, providing peace of mind throughout the transaction.
Avenue Law Firm
99 Park Ave 10th Floor, New York, NY 10016, United States
(212) 729-4090