Buying or selling real property can be a daunting task if you do not know what you are doing.   Many people successfully sell their own property, but often times title defects, liens, encumberances and other problems are lurking in the recorded title documents, which my go unnoticed for years.  Real estate brokers are frequently used to help the buyer or seller of real property, and an experienced real estate broker (or salesperson) can be very helpful in processing the massive paperwork that is required to consummate most real estate transactions. 

However, many real estate agents do not really understand all the legal requirements and wording contained in the recorded legal documents such as deeds, trust deeds and liens.  And, if you try to sell your property without going through escrow, you are probably asking for trouble.  Not every state requires that an escrow be opened for the sale of real property, and some states allow attorneys to handle those functions.  However, here in California, an escrow is usually required, and it is handled by an escrow or title company. Escrow serves several purposes.  First of all, escrow provides a way for the parties to a purchase and sale agreement to learn more about the transaction.  For example, the seller needs to be sure that the buyer can afford to purchase the property in question, and is willing to put a down payment into escrow to show that it is their intention to go through with the deal.  We call this "dealing in good faith."  The buyer needs to know the details of the property, and the escrow agreement generally provides that the buyer has a certain period of time to "check out" the property.  And, checking out the property may not reveal problems that cannot be seen with the naked eye. For example, in many geographical areas mold can be found behind walls, under carpets and in moist areas of a house, which is not visible from a simple walk-through.  Also, title defects such as hidden liens, encroachments, faulty deeds and other recorded documents, are often lurking in the title history of the property.  Finally, there may be special assessments from local city and county agencies affecting the property which also must be identified and dealt with. That is why it is always important to have a preliminary title report prepared for the property, and it is best to have that document reviewed by a knowledgeable real estate attorney.

In short, cutting corners is generally not a smart thing to do when you are buying or selling property, especially for the buyer.  Many lawsuits arise because the seller of real property has failed to disclose problems with the property that he or she knows of. And, those problems almost always surface once the buyer occupies the property.  I have been practicing law for over 35 years, and I have had an active California Real Estate Broker license for that entire time.  I also taught Business Law for many years at College of the Desert here in the Palm Springs area. I would be happy to discuss any issues you have regarding the buying and selling of real estate.

Thomas A Grossman, Esq.