In an ideal world, no one would ever need to go through a lawsuit over a real estate transaction, but there is always the chance that something will go wrong. If that happens, you should make sure you obtain legal counsel as soon as possible. Here are seven major causes of real estate litigation that could arise during your transaction:

  1. Breach of contract
    • The contract that goes along with any real estate transaction is ordinarily extensive and detailed, but it is essential. That contract details the responsibilities of both parties to the contract, and what happens if they fail in their duties. When someone violates the real estate contract, it can lead to litigation.
  2. Disputes over boundaries or survey results
    • One of the most basic elements of any real estate deal is determining what, exactly, you are buying. Normally this is not an issue, but sometimes there can be disputes over the boundaries of the property, or conflicting survey results. If these problems are not sorted out before closing, it can lead to a possible lawsuit.
  3. Undisclosed property defects
    • Another major cause of real estate litigation is undisclosed property defects. These are problems with the property that can add unforeseen costs to maintaining or repairing the property, including damage from a fire or flood, mold damage, or the presence of pests like rats or roaches. While a regular inspection is supposed to discover these problems, sometimes they may go unnoticed until it is too late, leading to litigation.
  4. Problems with title
    • When you buy a property, you do so with the expectation that you will have full, uncontested ownership over it. However, title defects like unpaid mortgages or liens, unpaid property taxes, or undisclosed easements and covenants can impair the transfer of title. If not corrected before the deal goes through, these defects can lead to serious problems and, of course, potential litigation.
  5. Problems with financing
    • In some ways, every real estate transaction is like any other sale: one person hands over property, the other person hands over money. However, most real estate transactions involve complicated financing requirements, which need to be satisfied in order to ensure the seller is paid for their sale. If there are problems with the financing, such as an error with the financial documentation, a buyer may find themselves unable to pay, leading to a potential legal battle.
  6. Undisclosed heirs
    • While rare, there are sometimes cases where someone will bequeath a property they once owned to their heir, even though they no longer owned that property. When that happens, the heir may show up and be shocked when they find someone else living in what they believe is their property. If this happens, it can very easily lead to real estate litigation.
  7. Fraudulent documents
    • While it is important to trust people you get into deals with, there is always the risk that the person on the other side will give you fraudulent documentation. This could include a fake dead, falsified financial documents, or anything else they might need to convince you to go along with their actions. To protect yourself from this, or any other problem, it is best that you speak to a lawyer who can help avoid potential real estate litigation, or fight for you in the event of a lawsuit.

    At David J. Lorber & Associates, PLLC, we assist clients throughout New York who are looking to buy or sell real estate. We will guide you through the process and help you minimize your legal and financial risks. Call us at (631) 750-0900 or contact us online to schedule your Free consultation at our Setauket office. 

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