Forcing the Sale of Real Estate in New Jersey

real estate in new jersey

When it comes to selling real estate, many problems can arise between the time a property goes on the market and closing. Financing issues, disagreement over the closing date, or discrepancies regarding the condition of the property can cause delays. Most of the time, the buyer and the seller are able to resolve these problems and work towards the mutual goal of a sale, but this isn’t always the case. If a deadlock occurs, either party could incur costs or face a potential lawsuit. If monetary compensation is not sufficient to repay a potential buyer for damages incurred, forcing the sale of real estate to the buyer may be the only way to resolve the issue.

“I don’t want to lose my dream home!”

Because of the unique nature of most real estate, sometimes financial compensation alone is not enough to make up for the loss of a real estate opportunity. If a buyer is attempting to buy their dream home or a uniquely advantaged commercial property and the seller fails to sell the property, this is considered a breach of contract. In this case, the only way to fairly compensate the buyer is to force the sale of the property to the buyer. This is also called specific performance. In New Jersey, specific performance is used to remedy the seller’s breach of contract and repay the buyers monetary damages.

In New Jersey, to establish the right to specific performance, a party must demonstrate three things:

  1. The contract is valid and legal
  2. Terms of the contract are clear enough for the court to determine the responsibilities of each party with reasonable certainty
  3. That an order forcing the sale of a property would not be harsh or oppressive to the seller

A court will look at a situation closely before ordering the sale of a property. Even if a contract is legally enforceable, there are outside circumstances that can impact the reasonableness of the sale of a property. The court will consider whether or not specific performance will unfairly disadvantage the seller or if denying specific performance will deny the buyer adequate compensation. Often, these court proceedings will involve a thorough investigation into the circumstances behind the real estate transaction and why a contract fell through. The court must confirm the buyer acted in a fair and equitable manner and behaved conscientiously in relation to the contract before a force of sale will be considered.

What if I don’t have a written contract in place?

While it is certainly more clear cut with a written contract, you do not have to have a contract to force the sale of real estate. Originally, New Jersey law forbade the enforcement of a contract for the sale of real estate if the contract was not in writing. However, a revision to law now allows for the enforcement of an oral contract in the event that clear and convincing evidence can be presented confirming the validity of a contract. The buyer must present proof that identifies the real estate in question, the names of the parties involved, the nature of the sale, and the existence of a mutual agreement to sell the property.

The forced sale of a property could also happen if a property’s co-owners cannot agree to sell a joint-owned property. In this situation, one co-owner can file a lawsuit against the other co-owner(s) to force the sale of the property. This is called a partition lawsuit. While these lawsuits are certainly a last resort in the eyes of the courts, and can be very costly for those involved, they do happen. The proceeds of the sale of the property will be divided evenly between owners based on established ownership interest percentages. In most cases, all parties involved in a partition lawsuit would net more from a voluntary sale of property than a court-ordered sale after a legal battle. Because of this, forcing the sale of a property with joint-owners should be a last resort.

If you are seeking to force the sale of real estate, you must file with the Chancery Division, General Equity Part of the Superior Court in the county where the real estate in question is located. Forcing the sale of a property can require significant documentation before a court will render judgment. Gathering all documentation required for discovery can be time consuming and confusing. Getting the help of an experienced real estate attorney can increase your chances of success in obtaining a force of sale.

Veitengruber Law is a full service New Jersey real estate team. We can help you navigate the complexities of any real estate contract. Understanding your rights as a buyer or a seller in a real estate transaction can ensure you do not miss out on your property dreams. We can help you reach your real estate goals!

 

 

 

NJ Quitclaim Deed: Explained

During a real estate transaction, there are several different ways to transfer title to a property. The most common type of deed used is a warranty real estate deed. This deed is used when a house is sold to a third party in a typical real estate transaction. The warranty deed is a legal promise that the person transferring the property has good title and the right to sell the property. A warranty deed includes protections for the buyer, the seller, and promises there are no liens on the property. Although a warranty deed is the most common deed, it isn’t always the best choice for every real estate transaction. Here we are going to look at quitclaim deeds and when to use them.

A quitclaim deed is often used when transferring property between family members. A quitclaim deed will transfer the title of a property but makes no promises about the owner’s title. In other words, a quitclaim will transfer the owner’s entire interest in the property to the person receiving the property, but it only transfers property the owner actually owns. Therefore, if the property is jointly owned—or split among different family members as with an inheritance—the owner can only transfer the portion of the property he or she actually owns.

It is important to note that deed transfers, warranty or quitclaim, only affect the ownership of a property and do not impact the mortgage on the property. This is especially important to keep in mind for those in a divorce situation where one spouse may quitclaim the property to the other. While the spouse relinquishing ownership over the property will have no rights to the property, they will still be responsible for the mortgage unless they remove themselves from the mortgage itself.

With all of that said, when should you use a quitclaim deed? Typically, if you are transferring ownership of a property without a traditional sale, it will be easier to use a quitclaim deed. This is often the case when property is being transferred between family members, married spouses, divorcing spouses, or when the property is being transferred to a living trust. It can also be used to clear up title to a property if there is a question about ownership right after a title search. Unlike with a warranty deed, a quitclaim deed requires no title search or title insurance making it fast and easy.

There is no quitclaim deed format specifically for New Jersey. An experienced real estate attorney can help you use a standard format to create your quitclaim deed. You will need to use the legal description of the property. This can often be found on the existing deed, a tax bill, or by contacting your local county clerk’s office. Once the quitclaim deed is completed, you will need to get it signed and notarized in the presence of a notary public. After that, you will need to file the deed with the county clerk’s office where the property is located. There is typically a small filing fee that varies by county.

As a full service real estate and estate planning law firm, Veitengruber Law can guarantee that your quitclaim deed is completed properly in compliance with local laws as well as filed correctly. Our  attorney and real estate team strive to handle all transactions with efficiency and professionalism. We can help you determine when and how to use a quitclaim deed to achieve your real estate goals.

Financing a Home as a Single Parent: What are my Options?

home ownership

Being a single parent isn’t easy. There are many unique financial challenges single moms and dads face as a one income household. For many single parents, buying a home can truly seem like an impossibility. But don’t give up on your dream of homeownership just yet. There are plenty of loan and assistance programs single parents can take advantage of, you just need to know where to look. In New Jersey, there are many state and federal assistance programs for home buyers with specific circumstances. While none of these categories explicitly list “single parents,” they can be a great benefit for those looking to buy a home with one income.

HUD 

One of the best places for single parents to start their home search is the U.S. Department of Housing and Urban Development (HUD). Contacting your local New Jersey HUD office can give you access to resources that will help you find housing options as well as demystify the home-buying process. A HUD housing counselor can fill you in on local home buying programs you might not be aware of or help you obtain a loan. Some single parents may also qualify for subsidies and extra assistance that will help you afford decent housing (depending on your income and employment).

FHA

Federal Housing Administration (FHA) loans are popular for many first time home-buyers, including singles on their own as well as single parents. FHA loans are government insured and easier to qualify for than other similar loans. There are many benefits associated with FHA loans that make them appealing to single parents, including a 3.5% down payment, lower credit score minimums, and low monthly mortgage insurance rates. FHA loans are also flexible about how a first-time homebuyer is defined. If you are recently divorced or become a displaced homemaker, you can qualify as a first-time homebuyer as long as the only residence you’ve ever owned was with a former spouse.

VA

Veteran Affairs (VA) loans are also an excellent resource for single parents. If you are a single service member, a veteran, or the surviving spouse of a veteran, you could be eligible for VA loan programs. There are a number of benefits for qualified buyers, including waived down payments and mortgage insurance, low-interest rates, and on-going support throughout home ownership. If you are facing foreclosure, the VA can step in to help you keep your home or find a new residence. In the event of a work-related disability, there may be additional Veteran’s benefits you can take advantage of.

USDA

The United States Department of Agriculture (USDA) offers a few different programs for low- and moderate-income home buyers in rural areas. Even if you aren’t sure that you live in a “rural” area, the USDA’s programs are still worth looking into. Many of the regions where programs are offered are located just outside major cities. USDA loan programs offer low interest rates and zero down payment options. Qualified borrowers can get 100% financing and the mortgage insurance premium is one of the lowest offered in any program. USDA loans do have an income maximum, but most single parents do not meet this maximum.

Private Lenders

Some private lenders will offer loan programs for single income borrowers. These custom loan programs can cater terms to your specific needs to help ensure that loan applicants get pre-approved for a mortgage. These custom loan programs can include help with your credit score or assistance with your down payment, among other things. While not all lenders will offer these kinds of programs for single parents, it is worth looking into as you begin your home search.

 

As a single parent, you aren’t limited to these programs. Your county, city, or even township might offer their own programs to help the single parent home buyer. Don’t lose hope in your dreams of owning a home. If you would like help getting started or with the application process, Veitengruber Law is more than happy to help you get on the path to home ownership!

 

 

 

 

 

 

 

The Multiplier Effect: What it Means for You in 2020

multiplier effect

In 2020, as you consider where and how to spend your hard-earned paychecks, there’s one economic force we at Veitengruber Law would ask you to consider: The Multiplier Effect.

Why exactly is it that money must be spent locally to benefit the community? In short, it boils down to the multiplier effect, which states that each dollar spent has an impact that is greater than the original sum.

For example, if you were to visit a New Jersey locally-owned hardware store to purchase a new door for your home rather than choosing to order from a big-box chain, the money you spent will allow that store owner to earn profits and pay a local employee, who will likewise spend money in the community, hopefully at another local shop, thus multiplying the positive impact of the original amount spent.

In this way, each dollar spent locally has the potential to send positive economic reverberations throughout the region, and will continue to do so as long as the majority of cash earned continues to circulate locally.

When we think about cities and towns in NJ that have gone from thriving and vibrant to economic wastelands, it is evident that these communities lack local investment. Without local businesses and investors reinvesting their wealth, the very infrastructure supporting the community fractures and collapses.

In order to avoid such conditions, businesses and investors alike must commit to the local communities that support them. By the same token, consumers can maximize the impact of every dollar spent by finding local businesses to support.

What will the multiplier effect mean for you as a New Jersey resident in 2020? Should you cancel your Prime account and forego the convenience you gain as a modern citizen of a global economy? Of course not. There are, however, ways you can spend locally without having to restructure your life.

First, if you’re in the fortunate position to have the capital to purchase an investment property in the new year, consider looking nearer to home rather than just shopping for the best bang for your buck. Not only will doing so encourage additional investments – people can’t invest money they don’t have, after all – but it will also improve the New Jersey landscape by ensuring property development continues to happen right here where we live.

Furthermore, every dollar spent in New Jersey is not only just earned and re-spent, but it is also taxed! Consider that cash spent locally can be taxed repeatedly – nearly indefinitely – until someone in that cycle breaks the chain by spending the money elsewhere. Tax dollars are absolutely essential to the establishment and maintenance of vital community services: schools, libraries, parks, and public transportation are just a few of the most beloved public services, none of which will survive without a steady stream of local spending.

What if you’re a first-time home buyer rather than a big-shot investor? Are the dollars you spend really going to have a significant impact, or does massive impact only accompany huge property investments? The answer couldn’t be clearer.

In the calendar year 2019, if we only consider NJ buyers who purchased new homes, they will have splashed out more than two billion dollars. When the National Association of Home Builders crunched the numbers, they calculated that the multiplier effect of such an astronomical sum would account for the creation of nearly four million local jobs, over $180 million toward wages and income of those workers, and $225 million in revenue for local tax funds.

Furthermore, this two billion will still be positively impacting the community after 12 months! Clearly, if we want our incomes to sustain, nurture, and grow the very towns in which we live, we have to commit to spending, investing, and hiring locally whenever possible.

If this article has sparked you to action, and 2020 will be your first year focusing on keeping your money circulating here at home in NJ, we couldn’t be more delighted. Here are easy-to-use resources to get you started:

 

 

You’re Ready to Move in New Jersey – But is Your Dream Home Move-in Ready?

When you’re buying a house, unless you’re into flipping investments or you crave big DIY and home renovation projects, you probably just want to unpack all your boxes and start enjoying your new “home sweet home.” But before asking your real estate agent to show you “move-in ready” properties, you should be aware of what that phrase actually means.

It turns out that, like beauty, “move-in ready” is in the eye of the beholder. To you, it might mean everything not only works, but it also matches your style, right down to the door knobs and paint colors. To a lawyer using Black’s Law Dictionary, though, it simply means that the municipality has approved the property as a place approved for people to live – the plumbing and electricity are up to code, the windows and doors lock, and no pesky pests are creeping around within. And yet, to the seller, it could mean the kitchen was recently remodeled – but there’s only one tiny bathroom, and the living room still sports ‘70s orange shag carpeting in passably good condition.

So rather than get tangled in terminology, here are five things to keep in mind when you’re doing a walk-through on that “move-in ready” property.

  1. Start at the Bottom: Flooring
    You may have opinions on whether you prefer carpet or hardwood, but regardless of what is on the floor, make sure it’s a solid base for your new home. That means no peeling tiles, no ripped or odorous carpeting, and no ominous creaks. And here’s an insider tip – bring a marble to place on the floors along your tour. If it rolls a lot, the floors may be uneven, indicating potential issues with settling or even the actual foundation.
  2. Plumb the Depths: Kitchens and Bathrooms
    Though a stainless-steel refrigerator, granite countertops, and a double vanity may be high on your “must-have” wish list, what makes a house move-in ready is ovens and dishwashers that work and toilets that flush. Make sure the faucets don’t leak and the water pressure is good. Ask about the capacity and age of the water heater and any pumps to be sure they can handle your family’s needs. (Most water heaters should last eight to 12 years.) Poke around the cabinets to see – and smell – that there’s no water damage or mold hidden among the pipes, and that nothing is rusted. Taste the water – if you move in, you’re going to be drinking it for a long time!
  3. Don’t Be Shocked: Electric
    Check the wiring to be sure your hot property isn’t a fire hazard. Confirm with the seller’s agent that everything associated with the electrical current is indeed current and meets the local codes. There should be no archaic knob-and-tube wiring in the walls, the breaker box should be powerful enough to handle the load, and the outlets and switches should all work without any issues.
  4. Take Comfort: Heating and Cooling
    Pause during your house tour, and just breathe. Are you too warm? Too cold? Or, like Baby Bear, do you feel “just right?” Ensure that there’s proper insulation in the attic and around the heating ducts and water pipes. Find out how old the furnace and HVAC systems are, too; their average lifespan is about 15 years.
    Make sure the windows open and close easily, and whenever possible, look for double-paned windows for the double benefit of protection from both temperature and noise.
  1. Think Outside the House: Roofing and Siding
    Don’t go through the roof – figuratively or literally. Find out how old the roof is; a roof typically lasts about 20 to 30 years depending on what it’s made of and what climate it has faced. Do at least a visual check for leaks, loose or missing shingles, or areas where the structure might be sinking a bit. Similarly, examine the siding and window frames for discoloration or warping that could indicate not simply water damage, but also underlying mold and other costly concerns.

 

You should always engage the services of an experienced home inspector to thoroughly examine these and other elements of the property to be sure your dream home doesn’t turn into a nightmare. And whether your house hunt takes you to New Jersey’s friendly southwestern suburbs, its gorgeous northern mountains, the bustling outskirts of New York City, or those sunny beaches down the shore, Veitengruber Law can help with title searches, title insurance, and due diligence to help you turn that “move-in ready” house tour into a “we’re really moving!” experience.

 

When is it a Good Idea to Buy a Foreclosed Property in NJ?

NJ foreclosure

Since the housing market collapse of 2008, New Jersey has had the dubious distinction of leading the nation in foreclosures. For a variety of reasons (divorce, loss of income, disability, etc) people in NJ are still struggling to make their mortgage payments and stay in their homes over a decade later. Navigating the foreclosure market is wrought with pitfalls and potholes. However, contrary to popular belief that buying a foreclosure property is always bad news, there are actually a few occasions where investing in a foreclosed home can be a manageable and economical option.

 

1. You know the neighborhood.

Things happen to a house that sits vacant. Without heat and air conditioning running, a house gets exposed to moisture and rot. Without people around to fix things as they break, leaks spring up, wires fray, appliances rust. Animals bore holes in siding and chew through electrical wires. Criminals may break in and steal copper pipes and appliances, or use the property for drugs. Squatters make themselves at home and don’t clean up after themselves. These are some of the things you can expect when buying a foreclosure. But you can stem some of that tide by knowing the property and its owners.

A house in a good neighborhood is watched more carefully than a house in a neighborhood with a high crime rate. Check the local crime reports and see what the town history is. Are there police patrols in the streets that would deter criminal activity?

Neighbors would also have a vested interest in keeping up the foreclosed property for their own property values. They may occasionally mow the lawn to prevent overgrowth, weeds, and ticks. If an abandoned swimming pool was attracting mosquitoes and wildlife, they would report it to the town. Invested neighbors will do some of the work of keeping up a property for you.

 

2. You plan to tear down the house.

If the land is valuable and you plan to tear down the house anyway, buying a foreclosed property can be a great deal. You don’t have to worry about hidden repair costs if you’re ripping everything out and starting fresh. Land in New Jersey is at a premium, so if there’s acreage involved, a foreclosure may be your best option.

 

3. It’s not your primary home.

The foreclosure process can take years, and even toward the end can fall through. The legal system has protections in place to try to get the homeowner to remain in their home. They have various recourses to take up until the last day, and even then may try to regain their house. If you are trying to purchase a foreclosure as your primary residence you could be tied up for a long time without a home. It’s best to look at foreclosures when you have time to plan. Second homes or investment properties are usually a better fit.

 

4. You’re experienced in investment properties.

If you’re looking to be the next HGTV house-flipping star, it’s a bad idea to start with foreclosures. Build up a solid background of investment properties bought with traditional mortgages first. You’ll become experienced in uncovering structure issues, but usually not on the scale of what you can find in a foreclosure. As you earn stable profits, you’ll be able to afford the risk of a foreclosed property. At that point, even if you make a bad investment, it won’t bankrupt you.

 

5. You get to a property early in the process.

There’s a good chance you won’t be able to perform a home inspection if the foreclosure is being sold at auction. Without a home inspection, you will be going into the purchase totally blind. You may be able to bypass an auction altogether if you get to the homeowner during the pre-foreclosure period. The buyer may be receptive to a reasonable offer and you’ll be able to perform home inspections to uncover any potential problems.

 

6. You have an experienced real estate attorney.

An experienced attorney like George Veitengruber can help you determine if a foreclosure property is the right investment for you. Veitengruber Law can perform a title search on the property and discover if there are any outstanding liens. When you purchase a home at auction you are inheriting property liens, so you want to make sure you know what you’re getting into.

If you’ve decided that a foreclosure is a good investment for you, Veitengruber Law can also help you prepare for the auction as well as attend the auction with you. All the paperwork needs to be ready in advance including your deposit, which is nonrefundable in NJ. If you are ready to accept the risk, a foreclosed property could be your way to a big reward.

How Much House Can You Afford in the NJ Real Estate Market?

NJ real estate

As a prospective first time home owner, it can be easy to get caught up in the dream of finding the perfect house without adequately taking your finances into account. In the rush of excitement, things like down payments, property taxes, and closing fees can be pushed to the back of your mind. You might find yourself in love with a property only to realize it is way out of your budget when the final numbers are laid out. When you first start the home buying process, it can be hard to know how much house you can actually afford. Before you jump into looking at houses, it is important to determine a realistic real estate budget. If you are looking own NJ real estate, here are some tips:

Know your take home pay.

Before you can start browsing property listings, you’ll need to become uber familiar with your current financial situation. Determining your take-home pay is a great first step to figuring out how much house you can afford. Your take-home pay is how much money you bring home in a month once taxes and other contributions are taken out of your paycheck. Unless you have a hefty savings that can cover the full price of a house, this monthly take-home pay is the money you will be using to cover your monthly mortgage payments on the loan you will take out to purchase the house.

Determine the length of your loan.

When it comes to a real estate loan, there are three major aspects to consider: the term, the interest rate, and the principal. The term of the loan is how long it will take for you to pay back the loan in full, including interest. The average mortgage term in NJ is 30 years.  Every home loan will come with interest. Interest is the amount that is in addition to the principal amount you will pay back to your lender. Mortgages have compound interest, meaning the interest is calculated monthly based on the overall debt you owe that month. You will be able to pay less in interest if you can afford higher monthly payments over a shorter period of time.

Decide on “fixed rate” or “adjustable rate.”

The amount of interest that will accrue on your loan will depend on whether you have a fixed rate mortgage or an adjustable rate mortgage. A fixed-rate loan has a locked interest rate. If it starts out at 4.2% it will always be 4.2%. This is typically the better option, especially if you can lock in a low interest rate, because your monthly payment will never change. With an adjustable mortgage, your interest rate will change with the fluctuations of the real estate market. This means you could end up with a very high interest rate over time.


Your total monthly loan payment is the biggest determining factor in determining how much house you can afford.


Allocate funds for an adequate down payment.

Most real estate experts suggest allocating no more than 25% of your take-home pay on housing expenses. If you can keep your housing expenses to less than 25% of your take-home pay, you should be able to manage the rest of your monthly living expenses comfortably. The size of your down payment can make your monthly more affordable. The more money you put down, the less money you will have to borrow (and repay.) It is generally suggested to put down at least 10-20% of the purchase price of the home. If you can afford a 20% down payment, you will not have to pay for private mortgage insurance (PMI), which can result in big savings on your monthly loan payment.

Of course, the money you borrow from a lender isn’t the only thing to consider when buying a home. You must also remember to calculate and prepare for:

  • Property taxes
  • Homeowners insurance
  • Closing costs
  • Renovations (if applicable)

All of these things will have an impact on your monthly costs for housing and your ability to afford a particular property. Buying a house is a major financial investment. Thankfully, there are plenty of online tools to help simplify the process for you. SmartAsset.com offers a free mortgage calculating tool that includes the home insurance and taxes you can expect to pay as a home owner in New Jersey.

Becoming a homeowner is a cause for celebration, but the process itself can also be very stressful. Veitengruber Law is a full service real estate law firm in NJ. We can help you through all of the financial aspects of the real estate process so you can focus on the excitement of your new home.

What You Need to Know About the NJ Appraisal Process

NJ appraisal

Whether you are buying or selling a home in the Garden State, you will have to go through the NJ appraisal process. If the buyer is taking out a mortgage, their lender will need to make certain financial decisions based on the results of a home appraisal. While this is a huge step in most real estate transactions, many people buying or selling a home aren’t sure what their role is in the home appraisal process. Here, we break down that process so you know exactly what a home appraisal can mean for you.

It’s true that a home inspection is intended to protect the buyer, a home appraisal is intended to protect the mortgage lender that is financing the real estate transaction. With a home appraisal, the lender in a mortgage is looking to get an objective estimate of the home’s value. They use this estimate to ensure that they are not lending more than the actual worth of the property. During a home appraisal, the appraiser is looking at everything on the entirety of the property, including: size, location, condition of internal and external home structures, any recent or necessary upgrades, and the price of comparable homes in the area. These pieces of information will provide insight into the true value of a home. From there, the appraiser will offer the lender a baseline sales figure.

In most real estate transactions, the buyer will pay for a licensed home appraiser to assess the property on behalf of the lender. The buyer will either pay at the time the appraisal takes place or add the fee to their closing costs. The lender will choose a licensed appraiser they feel will be the best judge of a home’s value, typically with a background in home construction, contracting, or home maintenance. A licensed home appraiser goes through at least 200 hours of coursework and must pass the state appraiser licensing exam before they can practice in the state of NJ.

A lender needs to be confident in the ability of the appraiser to remain objective in their appraisal, as well as their capability to back up every finding and their overall assessment of a home’s value. The appraisal report will include a drawing of the exterior, a map of the street and surrounding area, photos of the home’s exterior and street views, information on how the square footage was calculated, public tax and land records, and data surrounding area market sales. If any of these documents are missing, it can have a big impact on the home’s appraised value. If you notice any of this information missing, ask for another appraisal.

During the home appraisal process, it is common for the appraised home value to be more or less than the sale price of a property. If an appraisal is higher than the sale price for a home, this will benefit the buyer. But while the appraisal price and the listing price do not necessarily have to match, a major discrepancy in which the home is appraised for can lead to issues. As a buyer, you have a few options going forward. First, you can ask the seller to lower the sales price to match the appraisal price or pay the difference. A motivated seller may comply with this request.

If the seller does not comply, or the buyer is contractually obligated to move forward with the original sales price, there are still some things the buyer can do. If the buyer is concerned about losing their home loan, they can offer to increase the down payment. This way, the buyer is not borrowing as much money and may still be approved by the lender. The buyer could also agree to pay mortgage insurance. Borrowers who are financing more than 80% of their home purchase price will need mortgage insurance. This monthly payment would be tacked onto the regular mortgage payment and is typically .5%-1% of the total loan amount.

If the above options are not able to resolve the issue, a seller or buyer can dispute the home appraisal figure. The disputing party can work with their real estate agent or another licensed appraiser to come up with their own data. If this data diverges from the findings of the lender’s appraiser, there may be a case to correct the previous appraisal value. A lender will look at these findings and work with their own appraisal unit to come up with a new decision.

A home appraisal is an important part of any NJ real estate sale. Being knowledgeable of the process and understanding your options can save you a major headache later on. Real estate transactions are complex and the process never looks the same twice. Veitengruber Law’s experienced real estate team can help you navigate any potential problems with your appraisal, and throughout the entirety of your real estate transaction.

Are You Ready to Buy Your First NJ Home?

NJ home

In the US, homeownership has come to symbolize achieving part of the American Dream. Owning a home can offer independence, the opportunity to start a family, and a place to belong in the world. But owning a home isn’t for everyone—at least not right away. If you are considering purchasing your first NJ home, there are a lot of things to consider before you take the plunge. After all, the decision to own a home is a huge investment that will impact your life for years to come. If you are on the fence about homeownership, here are the top signs you are ready to buy a home.

1. You Plan to Stay in the Same Geographic Area

Being happy with where you are is a great sign you might be ready to plant roots and buy a home in your area. On the other hand, if you are planning to move in a few years or are unhappy with your current location, don’t purchase a home. With the cost of buying a home, between a down payment and closing costs, it doesn’t make sense to buy a home only to turn around and do the whole process over again in two or three years. You could also end up in the difficult position of being unable to sell your home, or having to sell your home for less than what you paid for it. For these reasons, it is important to only buy a home you plan to be in for a decent amount of time.

2. Your Finances are in Order

There are three financial aspects of the home buying process that you will need to be ready for: the down payment, the closing costs and associated fees, and the mortgage itself. For the down payment and the closing costs, you will need to have money in hand to complete a home purchase. Typically, a down payment is 20% of the purchase price and closing costs can range anywhere from 2-3% of the price of the home. You will also need to make sure you have a clear credit history with a decent credit score in order to secure a mortgage with good terms. But the financial responsibility of homeownership extends beyond your mortgage. You need to make sure that your income can support not only your mortgage, but home upkeep, property taxes, utilities, regular living costs, debt payments, and unplanned expenses.

3. You Are OK With the Idea of Home Maintenance

When you own your own home, you can’t call your landlord if something needs to be repaired. Every house will require repairs, maintenance, and improvements—and these can be costly and time consuming. All the time you spend on general upkeep of your home is less time spent doing the things you did pre-homeownership. This can impact your lifestyle. If spending the weekend painting the living room sounds terrible to you, you may want to reconsider a lower-maintenance housing option, like renting.

4. You Are Realistic About Your Home Goals

This means you know how much house you can afford as well as how much homes in your area are being sold for. A real estate agent can help you with this, but you need to know what kind of buying power you are bringing to the table and what kind of home will fit your budget best. Start going to open houses to get an understanding of what you get for the listing price. Look into a wide array of different kinds of houses in the neighborhoods you are interested in. How many bedrooms and bathrooms are there? Are there any special features? Is it up-to-date or does it need some work? All of these factors will help you determine what goes into a list price. Work with a real estate agent to get information about the estimated costs of repairs so you know exactly what you’re getting into before you buy a home. Buying a good home in your price range is key to homeowner success.

Buying a home can seem intimidating—and for good reason. The purchasing of a home is likely one of the biggest investments you will ever make. The rewards of owning your own space are innumerable, but it is also important to understand the work and commitment that goes into owning a home. If you need help working through the minutiae of buying a NJ home, Veitengruber Law is happy to help demystify the home buying process as well as make sure you are getting the most out of your real estate contract.

Help! I Want out of my NJ Real Estate Contract!

NJ real estate

The main goal of the negotiations surrounding a NJ real estate deal is for all parties involved to sign a contract they’re happy with. Sellers want to make a profit on their property and buyers want to have confidence in the huge investment they just made for their future. Sometimes, though, both parties sign on the dotted line only to find themselves second-guessing their decision. If something doesn’t seem right or you start to realize you didn’t get as much out of the deal as you had hoped, you may find yourself wanting out of the deal.

Is it possible to back out of a signed NJ real estate contract?

The good news is that even after you sign, there are still some ways to get yourself out of a real estate contract, but you have to act quickly. In New Jersey, the 3 day attorney review period will allow you to work with an attorney to bring your concerns back into negotiation. It is critical that you take advantage of New Jersey’s unique 3 day review period. During this time, you will work with your real estate attorney to review all aspects of the contract. As long as you’re within the attorney review period, you can make changes to the contract or walk away from the deal altogether.

What if I missed the attorney review period but still want out of my contract?

After the 3 day review period has passed, it is much more difficult to “un-sign” your name from your NJ real estate contract. In our experience, the three main reasons for a broken real estate contract are:

  1. Unsatisfactory appraisal
  2. Significant inspection issues
  3. Contingency clauses

Many real estate contracts include a contingency stating that the buyer and their lender must approve of the inspection and appraisal before a deal can move forward. If the buyer or lender is unsatisfied with the results of the inspection, appraisal (or both), it could open the door for further negotiations.

An appraisal price that is significantly lower than the purchase price will raise huge red flags for a lender and can give the buyer leverage to re-open contract negotiations. Likewise, a home inspection that turns up significant issues could give the buyer cause to break the contract if a seller is unwilling to make the necessary repairs.

While issues with inspection or appraisal can help the buyer back out of a contract, the “kick-out” clause of a real estate contract can be utilized by sellers. Traditionally, real estate contracts include a contingency clause that protects buyers from carrying two mortgages. The language usually reads like: “Buyer’s obligation to purchase this property is contingent on the sale of their current home.”

In today’s real estate market, many contracts now include contingency clauses that protect the seller if closing is dependent on the buyer selling their current home (as shown in the example above). Known as the “kick-out” clause, this contingency allows the seller to entertain other, potentially better offers on a property as long as the original potential buyer’s property has not sold. If a new buyer is found, the seller can “kick out” the original buyer and accept the new offer.

The key to getting out of a real estate contract is working closely with a trusted real estate attorney. In addition to helping you legally back out of a contract, your New Jersey real estate attorney will use the law to work in your best interest throughout the entirety of contract negotiations. Veitengruber Law will point out any issues or reservations about a contract early in the process. Understanding the ins and outs of a contract before you sign can save you the trouble of backing out later.

Our NJ real estate team is experienced in handling all of the complex legal details that go into real estate contracts. Working with us will ensure a smoother transaction and will get what you want! Don’t wait until you sign the contract to realize you need the advice of an expert attorney. Call us today for your free consultation about your real estate goals.