As a real estate attorney in Des Moines, we help Iowans follow the correct home-buying steps to avoid potential consequences. Skipping them may save time or money initially, but it leads to costly issues later. In this blog, I’ll share five reasons to always follow the right real estate transaction process during you Iowa home purchase.
Verify Property Ownership:
A crucial real estate transaction step is verifying the seller’s ownership of the property they’re selling. This may seem like a no-brainer, but it’s surprising how many people overlook this crucial detail. A thorough title search confirms the seller’s legal right to sell, preventing potential disputes and fraud.
Uncover Hidden Liens or Encumbrances:
A lien is a legal claim on property, typically securing debt repayment. Encumbrances are restrictions on property affecting its use or value. Before purchasing, identify liens or encumbrances on the property, as they become your responsibility as the owner. A title search and preliminary title opinion or Iowa Title Guaranty Certificate reveal and resolve issues before they burden you.
A recent client purchased a property via quit claim deed without an abstract update or attorney’s title opinion. Unfortunately several liens remained on the property because steps were skipped and shortcuts were taken. When our client went to sell the property a few months later, he was left to pay the judgments and legal fees to clear the liens, and unpaid transfer tax. Iowa Code 428A.1 requires a transfer tax be paid to the county recorder on any transfer in excess of five-hundred dollars. Ensuring title is and remains clear before purchasing, paying a seller, or transferring property is imperative.
Ensure a Clear Title Transfer:
Transferring the title of a property is the legal process that establishes the new owner’s rights to the property. Skipping or improperly executing this step can cause title issues, hindering future home sales. With a skilled real estate attorney, ensure correct title transfer for a stress-free home ownership experience.
Address Zoning or Legal Restrictions:
Before buying property, understand zoning or legal restrictions that may affect your intended property use. For example, if planning a home-based business or major renovations, ensure local zoning laws allow them. Failing to account for these restrictions can result in fines, penalties, or even the forced removal of improvements. A knowledgeable real estate attorney can help you navigate these complexities and ensure that your investment aligns with your goals.
Protect Your Iowa Home Purchase with a Legally Binding Contract:
A well-drafted purchase agreement is crucial for protecting both buyer and seller in a real estate transaction. This contract outlines sale terms and conditions, including contingencies (e.g., financing or inspection) protecting your interests. Skipping this step or using a poorly drafted contract can leave you vulnerable to financial loss or legal disputes. An experienced real estate attorney can help you draft a solid contract that safeguards your investment.
In conclusion, cutting corners in real estate transactions can result in costly mistakes and long-term headaches. By adhering to the proper steps and working with experienced professionals, you can ensure a smooth and successful home-buying experience. Rely on Danilson Law’s expertise for a stress-free real estate journey and a protected investment.
