By Pat Thompson, Vice President, NAI Michael
Working on a real estate transaction? Don’t forget the documents. While there are many aspects to bringing a deal to a successful conclusion, the use and understanding of many documents is necessary along the way. The use of written documents is not only practical, but is required by law, in order to ensure that transactions in real estate are enforceable.
There are three important documents that are regularly used that come to mind: listing agreements; contracts of sale; and lease agreements. Each can come in different initial forms and are often subject to substantial changes before they reach their final form. Whether generated by our office or produced by others, their importance cannot be underestimated.
What do these documents tell you? Almost everything, if they are properly prepared.
They are the roadmaps by which a transaction is guided to completion.
Preparation and/or review of these documents will likely involve the participation of attorneys representing their respective clients. Does that mean that the real estate agent steps aside and is no longer involved? I don’t believe so. If you negotiated the terms of the transaction, make sure they are accurately described and that each party’s rights and responsibilities in meeting these terms are clearly set forth.
This means that the real estate agent should have a good understanding of how these documents work and what their provisions mean. It is well worth any extra time it may take to negotiate and properly prepare them. In most cases, this preparation enables the entire transaction to go smoother, while avoiding misunderstandings that may be time-consuming and expensive to resolve later. Remember, in the unfortunate instance of litigation, these documents will speak for themselves.