Almost every purchase and sale agreement will require two separate negotiations: a letter of intent and a detailed purchase and sale agreement. The letter of intent can be made non-binding, but even if this is the case, once it is in writing, it is a key player in the continuing negotiations and formal purchase agreement documentation. A mistake or oversight made during the initial “negotiation” or letter of intent stage can lead to problems later in the process.
Because even a non-binding letter of intent can affect the final purchase and sale agreement, it is extremely important that a lawyer be consulted and involved in the process from beginning to end. Not consulting an experienced southern California real estate attorney before negotiations begin (letter of intent stage) is the single biggest mistake made by investors when purchasing real estate. They’re pulling the expert in after they’ve already laid down the groundwork of their negotiations.
When selling a property, an owner may not realize that their investment requires an equal amount of due diligence as was given during the original acquisition. As a seller, the point for an investor is to walk away from the deal with no future obligations, liabilities and a good profit. An experienced real estate attorney can pinpoint any negotiating points that could tie up an investors’ property for lengthy amounts of time, items that could lead to costly litigation, and potential pitfalls that could prevent the sale of the property entirely while disputes are resolved in court.
A vigilant seller will pay attention to every single part of the negotiation: the property’s legal description, the purchase price, any required deposit amounts, the contingency period, conditions on closing, representations and warranties, damage and destruction consequences, prorations, indemnification clauses, etc.
When it comes to the final liquidation of your real estate investment, don’t assume things will go your way, make sure they do by working with an experienced southern California real estate attorney at The Law Office of Retz & Aldover LLP.