Buying or selling a home is one of the most significant financial transactions most people will ever undertake. With so much at stake, understanding the legal side of real estate contracts is critical. Whether you’re a seasoned investor or part of the 26% of homebuyers purchasing for the first time, according to the National Association of Realtors, avoiding common mistakes in real estate contracts can save you from costly delays or even legal disputes.
Unclear or Missing Terms
One of the most frequent issues in real estate contracts is unclear language or missing terms. Ambiguities in the contract—such as vague timelines, undefined repair responsibilities, or unclear contingency terms—can lead to misunderstandings between buyers and sellers. A well-drafted contract should clearly outline every essential detail, including price, closing date, and what is included in the sale (like appliances or fixtures).
To avoid this mistake, consult a professional who understands real estate law. They can ensure your contract is complete, specific, and free of legal gray areas that could result in conflict down the line.
Failing to Include Contingencies
Contingencies are protective clauses that allow a party to back out of the contract under certain conditions—such as failing to secure financing or discovering serious issues during a home inspection. Without contingencies, a buyer may be forced to move forward with a purchase even when problems arise, or risk losing their earnest money deposit.
Contingencies are not one-size-fits-all. It’s essential to include ones that match the unique circumstances of the transaction. An experienced real estate law professional can help you craft contingency clauses that protect your best interests.
Overlooking Deadlines
Real estate contracts contain several important deadlines, such as inspection periods, mortgage approval dates, and closing schedules. Missing a single deadline could mean breaching the contract, which might result in penalties or losing the deal entirely.
To stay on track, keep a calendar of key dates and coordinate closely with your agent, lender, and attorney. A strong understanding of real estate law ensures you understand the implications of each deadline and stay in compliance with the terms of the agreement.
Inadequate Disclosure Requirements
In most states, sellers are required to disclose known issues with the property, including structural problems, pest infestations, and environmental hazards. Failure to disclose can lead to lawsuits long after the deal is done. Buyers should also carefully review all disclosure forms and consider conducting independent inspections.
If you’re unsure of your responsibilities or rights when it comes to disclosures, legal guidance is essential. A real estate law expert can help both buyers and sellers navigate this critical aspect of the transaction with clarity and confidence.
Improper Use of Templates or Generic Forms
Online templates may seem like a convenient way to draft a contract, but they often fall short in addressing specific needs or complying with local laws. Every real estate transaction is unique, and using a one-size-fits-all document can leave you vulnerable to oversights or unenforceable clauses.
The best approach is to work with a professional who understands both the legal requirements and the nuances of your specific situation. This ensures that your contract is not only legally sound but also tailored to your goals.
Not Consulting Legal Counsel
One of the biggest mistakes buyers and sellers make is waiting until something goes wrong before calling an attorney. Real estate transactions involve significant legal obligations, and a misstep can be both stressful and expensive.
Even if everything seems straightforward, having a lawyer review the contract before signing can prevent problems later. Legal professionals specializing in real estate law can identify risks, clarify confusing terms, and ensure you’re protected throughout the process.
A real estate contract should give all parties peace of mind—not stress and uncertainty. Whether you’re buying your first home or managing multiple properties, working with a trusted legal partner ensures that your transaction moves forward smoothly and securely. At The Law Office of Lawrence M Centanni, we provide expert guidance in real estate law to help buyers, sellers, and investors avoid costly mistakes and protect their interests at every stage. Let us help you make informed decisions and navigate the process with confidence. Reach out to our team today to get started. We look forward to working with you soon!
