The fact is attorney review is not needed until the bank has made full approval. The bank will then renegotiate the contract terms and conditions. "Subject to Third Party Approval"
Kim you are right when attorneys are involved they will negotiate terms but the bank will also change them again and then the review starts all over again.
So in my book and all concerns attorney review does not start until bank makes full approval. The original contract between buyer and seller can be binding with conditions not allowing buyers to leave a contract until a bank has rejected or approved. or a time has lapsed. I'm sure we can all comment on the terms and conditions and reviews. But the fact is review does not start until bank approves the contract.
No offense to anyone...
What you did was meaningless. Sure you can have attorney review, but it is meaningless if the bank says no.
I never said do not go into attorney review.. Rather, once the bank approves the sale number attorney review starts, Once I have an approval I then give the file to an attorney to finish with the bank.. The people who negotiate the terms of the short sale.
The escrow money can sit in the real estate office escrow account.
"The time frame for the buyer to wait for approval was ironed out by the attorneys In another contract"
That makes no sense, without the bank accepting the offer there is no timeframe. You think a bank could care less about an attorneys "negotiated" time frame for an answer.. it is going to happen on the banks processing terms.. Not because an attorney gave a date.
â€œFor instance the buyer did not want to invest money for inspections until the sellers lender approved the short dollar amount, that was ironed out by the attorneys in attorney review"
What was "ironed out" ? Don't do your home inspection until the bank accepts the offer.. makes sense.. why waste your money without a bank approval.. -anyway- it is not like anything is going to be addressed, it is a short sale because the homeowner has no money to pay the mortgage, let alone fix inspection issues..
But, I am a Realtor that is hands on in my short sales.
There is no attorney review until the bank accepts the offer. Yes the "homeowner's" name is on the mortgage, but they are also asking they agreed to pay for the house. Until the bank says we accept.. there is no need as there is nothing for the attorneys to negotiate.
I tend to use an attorney that is well versed in short sales....but lately that hasn't seemed to influence the process much ;-(
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The attorney review process as noted below and posted by Kim is exactly the answer. Once the buyer and seller agree to a contract the buyer / seller may choose to have the contract studied by an attorney... exactly.
In the case of a short sale the seller is the bank. Once the bank agrees to accept an offer, the buyer / seller can go into attorney review.
The short sale approval came quickly and it required the buyer to close in 20 days. The buyer had to rush an attorney review, an inspection, and an appraisal for his mortgage commitment. Unfortunately, the 20 days was not enough time and a request for a short sale extension had to be requested. It took another 30 days to get another approval. If the above was completed prior to the approval, the buyer could have closed sooner rather than later.
The more information you know up front about a seller's situation and their lender requirements, the better your chances of knowing whether or not a short sale will be approved.
For the protection of the seller, attorney review should conclude just prior to closing with the property contuing to be shown for backup as once you have a contract u are bound by that contract even if someone comes in ans offers you more. I;m sure many realtoirs will puh, puh this as per the text book, but it came to me from a relaiable source and makes sensce since many short sales fall through and to have the oproeprty off the market for 6 months only to find out that the deal fails costs 6 months of time. In this instance, at least you have backups.
Francesca Patrizio, Broker Sales Associate,, ePro, SRES
732.606.2931 (Direct/Cell 24/7)
In New Jersey, a licensed real estate broker and sales people are permitted to prepare contracts for the sale of residential real estate containing one to four dwelling units and for the sale of vacant one-family lots, as long as the real estate broker had a commission interest or ownership interest in the property and only if there exists a three-day attorney review clause which is prominently displayed.
The history of the three day attorney review clause dates back to 1970, when a New Jersey real estate broker was convicted of disorderly conduct for the preparation of a real estate contract. The real estate brokers argued that they were doing more than filling in facts of a preprinted form. There were many attorneys that were concerned that their realtors were engaged in the practice of law and no matter how well drafted the realtor-prepared contract was, that the form did not reduce the danger to the public to be bound to a legal agreement which was not prepared by a person licensed to practice law.
In 1972, a compromise resolution was worked out between the New Jersey State Bar Association and the Board of Realtors and the law has permitted the real estate broker to prepare a real estate contract subject to the requirements as noted above and the insertion of a three day attorney review period.
The standard attorney review clause as approved by the New Jersey Supreme Court is as follows:
1. Study by Attorney
The Buyer or the Seller may choose to have an attorney study this contract. If an attorney is consulted, the attorney must complete his or her review of the contract within a three-day period. This contract will be legally binding at the end of this three-day period unless an attorney for the Buyer or the Seller reviews and disapproves of the contract.
2. Counting the Time
You count the three days from the date of delivery of the signed contract to the Buyer and the Seller, You do not count Saturdays, Sundays or legal holidays. The Buyer and the Seller may agree in writing to extend the three-day period for attorney review.
3. Notice of Disapproval
If an attorney for the Buyer or the Seller reviews and disapproves of this contract, the attorney must notify the REALTOR(S) and the other party named in this contract within the three-day period. Otherwise, this contract will be legally binding as written. The attorney must send the notice of disapproval to the REALTOR(S) by certified mail, by telegram, or by delivering it personally. The telegram or certified letter will be effective upon sending. The personal deliver will be effective upon delivery to the REALTOR(S) office. The attorney may also, but need not, inform the REALTOR(S) of any suggested revision(s) in the contract that would make it satisfactory.
The requirements for the attorney review are also set forth in the New Jersey Administrative Code 11:5-6.2.
Just thought this was an open form to answer the question at hand regarding
When attorney review starts
stating the fact all real estate contracts have an attorney review was important for the public to know without insulting one another profesdional Which shows true professionalism. Hope you have a fantasy 2012 an no one insults your integrity, intelligence and professionalism! All the best!