3 Key Takeaways from our Introduction to Real Estate Law seminar

3 Key Takeaways from our Introduction to Real Estate Law seminar

When it comes to real estate investing, newbies are generally at a disadvantage to experienced investors. Like all rookies, it takes time to learn and adapt to the playing field. Real estate investing is certainly no exception, especially real estate law and negotiating contracts. However, educating yourself about areas you’d not as familiar can certainly help level the playing field, even in large transactions.

That’s why we had a great Intro to Real Estate Law seminar for new investors, as well as some networking, this last Friday, led by @Randi Plevy, a NYC real estate attorney. We had the pleasure of being hosted by Judicial Title, so thank you very much. Thank you for those who attended and who signed up for our event. We apologize for the limited seating and we’re looking to increase the number of people that can attend for future events, so we hope you can make it. Sign up here to reserve a space in advance of our next upcoming event! https://goo.gl/forms/IDtesDFYVUTdrn8Z2

While every new investor needs to learn how to analyze a deal, understanding basic real estate law and reading through a purchase agreement may be the last thing on a new investors to do list. First, the documents are long and boring to read, with small font. Second, new investors may simply rely on attorney (or agents) and not fully understand the terms of the agreement. And most importantly, it takes time to understand legalese and how it impacts your rights in a transactions. But the best thing rookies (and experienced investors) can do is read the contract and learn how it impacts every transaction.

Here are my top 3 takeaways from our Intro to Real Estate Law seminar:

1. Using a standardized real estate purchase agreement doesn’t mean you don’t have to read through it. Some standardized forms have very nuanced language that only your attorney may understand, but you can learn too. Read the contract, ask your attorney (or post on BP) your questions. Ask a title company for a sample contract and see how that meshes with the one you already have. Maybe there’s a newer version that’s come out and make changes to some of the existing terms. So time #1, always read your contract!

2. Make sure the property description and address is the one you're buying! You do not want to be at the closing table, or even worse, after closing, and realize that the you're buying the wrong property. Double check the street address with the block and lot number or local property tax assessor's office.

3. Make sure to add an assignment clause. This allows sellers to transfer the rights of the contract to another person or entity. Without this in the contract, you may be limited in terms, or unable, to assign the contract to your end buyer until after you close on the property.

Bottom line: you must understand your purchase agreement. When you negotiate, take notes and make sure what you want, goes into the purchase agreement. Don't rely on others to read the purchase agreement: you should read and re-read it! They are only the most integral documents in every real estate transaction.