This has already been a very busy spring for buyers, sellers and real estate agents in many parts of the country. In order to ensure that your deals close in an orderly manner, without any additional costs, expenses or aggravation for you and your clients, take care to avoid the following common real estate mistakes.
1. Try not to do everything by yourself; know when to ask for help
Clauses: How many times have you written in that the home will be left free of garbage and in a broom-swept condition on closing, only to find that the home is a mess at the pre-closing visit? In order for a buyer lawyer to be able to hold back money on closing to solve the issue, it has to say so.
Why not include the following language: “If the home is not in a clean and broom-swept condition at the time of the final pre-closing inspection, the buyer shall be given a credit in the final statement of adjustments in the amount of $XX (you choose the amount).
Condominium keys and fobs: I can’t tell you how many times buyers have complained when they have not received two full sets of keys, garage door openers and fobs on closing. How about the following language:
“Seller agrees to deliver to buyer on closing: two complete sets of keys, garage door openers and fobs for complete access to the condominium unit, the mailbox, the building, parking garage, all common areas and the locker unit for the property purchased. If the Seller fails to provide any key, garage door opener or fob, then the Seller shall immediately pay the Buyer the actual replacement cost of any such key, garage door opener or fob or the Buyer shall be given a credit for this amount on the final statement of adjustments.”
Conditions: If the condition expires five business days after acceptance and the contract was accepted at 4 pm, when does the condition expire five days from now – at 4 pm, 6 pm or 11:59 pm? Who wants to go to court fighting about it? Why not insert language that just says:
“Conditional until 11:59 pm on the 5th business day after acceptance.”
2. Planning/zoning/tree issues. Also know when to ask for help
Any issue regarding parking pads or permits, basement apartments, zoning, building permits and lot coverage is not easy to figure out. If you are not sure, make the deal conditional upon lawyer review or further due diligence. Consider hiring a private planner who is experienced with the applicable city bylaws to assist you. If you have an issue with a tree on or near the boundary line, contact an arborist to assist you. Cities have different bylaws when it comes to taking down trees or cutting roots or branches, so be informed in advance.
3. Avoid careless errors
One of the most common errors is when an agent copies the information from an expired listing instead of doing the required due diligence. It would likely also be considered a breach of your ethical duties of due diligence. Remember, one of the reasons the listing may not have sold is because of the effort put in by the prior agent. Don’t make the same mistakes. If you are not sure about anything, even after doing due diligence, consider using a disclaimer clause that your seller is not warranting the matter and the buyer should conduct their own due diligence. This is especially true when it comes to room measurements or lot sizes.
4. Do it the same way every time
When you review the Realtor agreements or your agreements of purchase and sale with your buyers and sellers, do it the same way every time. Make sure the clients understand all key provisions, including the price, deposits, closing date, chattels/rental items included and any conditions. Remember, conditions need to be exercised in good faith or sellers may refuse to release any deposits.
5. Little things matter
Is the closet organizer or television bracket included? Be clear about all the little things in your deal and your buyers and sellers will not have aggravation after closing.
By avoiding common mistakes, not only will you have less aggravation this spring, your clients will appreciate your services even more, which should lead to more repeat business and referrals.