Real Estate Law
Transactions, Deeds, Contracts
Real estate agents cannot provide legal advice and representation. Under Wisconsin law real estate agents act as intermediaries rather than representatives of the parties.
How important is the offer to purchase?
The offer to purchase is critical. It sets the terms under which a sale is made. It is a legally binding contract when signed by both parties and its contingencies are met. Contingencies (such as financing or property inspection) are conditions that protect the parties and must be understood by them. The offer establishes what property will be sold, what it will cost, when the sale will close, how closing costs will be allocated and the other terms of the transaction. It also determines if buyer's earnest money will be forfeited or returned if sale does not close. Since the offer has important legal ramifications, the parties should seek legal assistance in dealing with it.
How does marriage affect real estate ownership and control?
Married couples living in Wisconsin are subject to the Marital Property Act, which affects how property is owned. Under that law, property may be:
• the individual property of one spouse
• marital property (owned in equal, separate shares by both spouses); or
• survivorship marital property (marital property with a right of the survivor to full ownership when the first spouse dies, like joint tenancy).
Marital property may be titled to either spouse or both. However it is titled, both have an interest in it.
What's the difference between a warranty deed and a quit claim deed?
A warranty deed "warrants" or gaurantees that the title is free of all encumbrances except those mentioned in the deed. A quit claim deed transfers what title the seller has (if any), without guaranteeing the quality of title.
Are there legal issues in financing?
Financing is the key to most real estate transactions. It is how buyers get the funds to make their purchase. Financing usually is obtained from a commercial lender - a bank, savings institution or the like. To secure the repayment of the loan, the lender will take a mortgage on the property purchased. It also will look into the buyer's finances and credit history.
What about a land contract?
A land contract may be used where the seller finances the buyer's purchase of the property. Rather than paying the entire purchase price at closing, the buyer pays the seller in installments and receives a deed when all payments are made. For the buyer the land contract may have a smaller down payment, lower interest than a regular mortgage and closing costs usually are less than in a mortgage. Often a land contract will have a short term and involve a lump sum (balloon) payment of the balance when the buyer's equity will allow mortgage financing of the property. For the seller, land contract financing may allow a deferral of capital gains over the term of the land contract payments because the seller does not get all of the sales proceeds on closing. Enforcement of a land contract is somewhat easier than a mortgage, but the seller assumes the risk that in the event of default the seller may have to retake the property and resell it.
Disclaimer: This summary offers basic legal information only and does not offer legal advice. If you have legal problems, please seek legal advise; only an attorney can advise you on how the law applies to the specific facts of your situation and in your location.