Weekly Roundups will resume starting April 5
In this nascent world of restrictive credit standards, anyone buying a new home needs to expect the expected.
When it comes not only to getting mortgage approval but also to getting promised funds, buyers can count on roadblocks that could delay or even prevent settlement.
That is why it is essential for their attorneys to include appropriate financing contingency clauses in the contracts. Those clauses allow buyers to have their deposits returned in the event that lenders don’t finally provide the money to close.
Considering that the usual deposit of 10 percent of the purchase price — $40,000 on just the $400,000 purchase of a studio apartment — is a substantial sum, contingency clauses are not to be taken lightly.
Notes Forest Hills lawyer Ryan J. Walsh, whose explanation I’ll paraphrase liberally below, there are three major contingencies that can protect a buyer: Continue reading
There’s more than one way to lose a buyer, and today’s post centers on a common one — that pesky “as is” clause.
Contracts for the sale of condos and co-ops in Manhattan and elsewhere in New York City generally include the clause, which stipulates that the buyer accepts the apartment “as is.” If the clause is not included, contingency language allows the buyer to cancel the contract in the event that the seller doesn’t agree to remediation.
Including an “as is” clause, especially for units in new buildings, shifts risk from the owner to the buyer. And the risks — e.g. shortcomings in workmanship or code issues — are manifold in new developments. So be it: caveat emptor. Continue reading