The acquisition of a home can or cannot proceed without a real estate binder. It is a document that includes basic business terms of a purchase and sale agreement. A binder is usually delivered to the seller with a small deposit – typically 1% of the purchase price offered. Depending on the language of the contract, it can be enforceable or unenforceable. 

A contract documents all the terms and conditions of a sale or purchase. It is a legally binding document which ties two parties to the purchase or sale of a home.

Contingencies are simply occurrences that must take place to complete a real estate transaction. It becomes a part of a sales contract when both the parties agree to certain terms and sign a contract. If a contingency is not “fulfilled,” one or both the parties can cancel a transaction. 

Contingency dates are the deadlines by which a specific condition must be met. These are critical as a certain contingency has to be completed by a stated contingency date. In case of delay, either of the parties can officially notify legally beforehand. Failure to do so might result in the termination of the contract.

If a problem turns up during house inspection before the contingency date, the buyer can cancel the contract. In other instances, buyers can negotiate with the sellers to cover the cost of some or all of the costs. Some examples of flaws are broken garage door opener, termites, or plumbing issues. 

If there are no unexpected circumstances, a home purchase closing with a mortgage usually takes around one hour. It takes even less time for sellers who have fewer documents to sign. Sellers can pre-sign their documents in certain instances, avoiding the need to attend the closing.

The cost of closing varies from one case to another. Some of the costs involved in the total cost of closing are attorney fees, conveyance taxes, bank fees, title insurance, and escrows.

It’s a tax imposed on the transfer of a property from one owner to another. In CT, there are two types of conveyance taxes, one is paid to the town where the property is located, and another is paid to the state. Municipal tax rates currently (2021) range from 0.25% to 0.5%, depending on the area. If the purchase price is less than $800,000, state taxes are 0.75%, and if it is more than $800,000, they are 1%. Both of these taxes are paid by the seller, while the buyer’s attorney provides the checks for payment at closing.

A Quit Claim Deed is a quick way to transfer property to a buyer but it includes no protection for the buyer, unlike special Warranty Deeds. When a Seller delivers a Buyer a Warranty Deed, the Seller is “warranting” that he or she is the owner of the property and that no one else has any rights to it other than what is revealed in the deed and/or agreed upon by contract. If the Buyer uncovers an unreleased lien or another party claiming an interest in the property after closing, the Buyer may be able to sue the Seller for violation of the warranty of title.There is no such warranty of title with a Quit Claim Deed.

In layman’s terms, title insurance guarantees that you own your house free and clear of any claim, lien, or encumbrance other than those listed on the policy at the time of purchase. If this information is incorrect and a claim is filed against your ownership, the title insurance company pays your attorney’s fees to defend you against the claim, and if the claim is found to be valid, the title company will either pay the claim (up to the policy limit) or fix the title defect at their expense. Lenders will ask you to acquire a “Loan Policy,” which protects the lender’s interest in the property but not yours. In most cases, the Buyer purchases an Owner’s Policy. The state of Connecticut determines title insurance rates, which are dependent on the home’s purchase price. Attorneys function as agents for title insurance firms in Connecticut, and we will handle the issuance of your title policy.

Below are some common legal issues with residential real estate:

• Concerns with Buying a Home
• Concerns with Title
• The manner in Which Title Is Taken and Held
• Different Forms of Deeds
• Survey Issues
• Easement Issues
• Escrow Issues
• Zoning Issues