Insulating Against A Law Suit

Generally most of my posts are adaptable to sales in any industry. Today I am specifically addressing real estate sales. If someone practices real estate very long, they will face legal issues; especially if they sell a lot of real estate. There is a very simple explanation for it too. It’s impossible to please everyone, and especially, if you represent both the buyer and the seller. In this type situation the buyer feels like the seller took advantage of them, while the seller feels like the buyer took advantage of them. As a Realtor® who is wedged between both parties thinking the agent showed partiality to the other party in the transaction. To complicate matters worse, in a typical real estate sales transaction there are numerous entities that have specific requirements and guidelines that must be followed.

Managing Your Risks

Generally most of my posts are adaptable to sales in any industry. Today I am specifically addressing real estate sales. If someone practices real estate very long, they will face legal issues; especially if they sell a lot of real estate. There is a very simple explanation for it too. It’s impossible to please everyone, and especially, if you represent both the buyer and the seller. In this type situation the buyer feels like the seller took advantage of them, while the seller feels like the buyer took advantage of them. As a Realtor® who is wedged between both parties thinking the agent showed partiality to the other party in the transaction. To complicate matters worse, in a typical real estate sales transaction there are numerous entities that have specific requirements and guidelines that must be followed.

In most real estate sale transactions there are two separate agencies involved. 

More times than not one agency will have the listing and represent the seller while the other agency will represent the buyer. [Read more…]

Understanding Caveat Emptor

 Alabama is Different than most other States…. I can’t say for sure but based on my research, the only states that are still caveat emptor states are Virginia, Arkansas, and Alabama. When a person buys real estate in these three states, they need to fully understand it is their responsibility to make sure they know what they’re getting, that it’s in good condition and works properly. When the buyer does his due diligence to have the property inspected, their legal rights remain in place after closing should some latent structural defect appear. If a buyer elects not to have the proper inspection done, closes on the transaction and then a latent structural defect appears and the buyer sues for damages; numerous Supreme Court cases have ruled in favor of the seller and stated caveat emptor; the buyer is responsibility to inspect the property prior to purchase.

BUYER BEWARE

This is a topic I try to talk about in every class I teach because it is the most important and the least understood law. I intentionally try to scare real estate agents to get them to understand the importance of the law and the effects it has on people buying real estate in Alabama. Today I will tell you how to see the law as it is written, disclose the other states that have the same law, and explain the dangers and remedies associated with caveat emptor.

Caveat Emptor is the law in Alabama…..

The Alabama Supreme Court has held caveat emptor to be the law in a consistent line of cases. Everyone should be on notice that there is no warranty which comes with the sale of a used home.

Real estate agents were taught when completing their educational requirements to get their license that caveat emptor is a Latin [Read more…]

Internet is Hurting the Buying Public

Our job is to protect the consumer!

Our job is to protect the consumer!

I’m sure a lot of people will disagree with my topic statement. Hopefully you’ll take time to read it and then I think you’ll agree with me; at least in part. According to the National Association of Realtors most recent studies, close to 95% of real estate buyers search the Internet to find property for sale. In some cases, by doing so, buyers are more familiar with what’s on the market then the agent at the time the buyer contacts the agent. In some cases the buyer tries to buy a property directly from the seller, rather than using the services of a real estate agent, and this is potentially harmful to the buyer. For anyone buying real estate in Alabama, Arkansas and Virginia, it is especially dangerous because of Caveat Emptor. State laws, in these states, place all the responsibility on a buyer could cost the buyer a lot, financially, after the sale has closed. Without talking with an agent in those states, the buyer would never know about the laws that could affect them and it could cause them to have no legal recourse should a serious issue arise. [Read more…]

Caveat Emptor….An Actual Case

Caveat Emptor–Respect and Embrace it

I have spent a great deal of time teaching and lecturing regarding Alabama being a Caveat Emptor state. Buying real estate in Alabama is different from most all other states. It is not a law that should be feared but respected. Caveat Emptor should be embraced because it gives advance notice to buyers what they must do to provide future legal recourse. Not everyone is aware of the law until they learn of its affects; sadly too late to take precautionary measures. Below is a reprinted copy of an email that was directed to me for which I sought and received permission to share with my followers. The names have been omitted as requested by the consumer.

Consumer’s situation stated

 Mr.Anderson:

My name is Could BE Anybody and I write to you from Huntsville. I work at a law firm as a civil litigation paralegal (doing primarily municipal defense work) but this message is personal and has nothing to do with my job. I’m using this account to avoid a spam filter.

My husband and I had a crisis of sorts over the weekend which led me to your articles and I just wanted to say thank you not only for writing them but for writing them to be of dual benefit to realtors and buyers.  The short version is that we were interested in a house in Any City, Al. (Any County), [Read more…]

The Process for Buyers to Work with Real Estate Agents

Real Agents are for Your Protection

There’s a right and wrong way to do almost everything. Buying real estate is not difficult but it can be very costly if you don’t take the right steps. I would like to share this simple process in a way that you can understand it and hopefully realize the importance of each step.

Step one is to hire a Realtor® to represent your best financial interest.

Don’t let the word “hire” scare you. Hiring someone to represent you will seldom cost you anything because the seller pays a commission to the Realtor® to professionally market their property for them. This commission is generally divided between the listing agency and the selling agency unless both sides of the transaction are performed within the same agency. Therefore let’s eliminate the thought of you having to pay to have someone represent you.

Buyer’s need to be cautious [Read more…]

What Consumer’s Need To Know

Questions Need Answering

This information is specific to what consumer’s need to know when buying or selling real estate in Alabama. Even more specifically, what consumers need to know when working with a real estate broker? Especially since Alabama is a Caveat Emptor state which places total responsibility on the buyer to do their due diligence in inspecting every aspect involved with a property prior to closing on a sale.

For years the seller has known who represents him when selling real estate but who represents the buyer? Who looks out for the buyers best financial interests? Some agents think the liability is too great when representing a buyer, largely due to the Caveat Emptor law; therefore they want to assist the buyer as a transaction broker to limit their liability. That being the case, many times, the poor buyer is left to fend for themselves without being told what they need to do prior to closing so they can protect their legal recourse options. The State of Alabama understands the precarious situation the buyer  is in when buying in Alabama so they provide

Pages: 1 2

Meaningful Conversation for Alabama Realtors

Alabama Realtors--Warn Your Buyers

2012 is license renewal year for Realtors® in Alabama and each agent must complete 15 hours of Continuing Education which is required by the Alabama Real Estate Commission. I have been holding CE classes all across the state and have noticed so many agents experiencing difficulties with the delicate balance between our RECAD requirements and having a meaningful conversation when contacting a prospective buyer for the first time. Since I encourage classroom participation, I have heard some of the most experienced, most successful real estate role play their RECAD process. I am shocked at their omission of the most important information we can share. Omitting this type information could affect the financial wellbeing for someone buying real estate in Alabama. Sharing this type information would definitely qualify as having a meaningful conversation. I’m sure you have already figured out that I am referring to the fact that Alabama is a Caveat Emptor state. For those outside the boundaries of Alabama, I will explain the importance of this statutory law.

[Read more…]

Real Estate Buyers – Know What You’re Signing

“AS IS” Term Can Cost You A Fortune

Real Estate Agent Didn't Tell Me

My Realtor Didn't Tell Me

I don’t mean to scare anyone but as a real estate educator, trainer, and coach, I feel a responsibility to everyone that might buy real estate in Alabama sometime in the future that you should be told about your legal rights and obligations. If you are former students of our school you should also know your fiduciary responsibilities to disclose this information to all your clients. If you are currently a Realtor® in Alabama you need to understand the seriousness of this issue too.

Two words, “As Is” are very small words but they can impact you for life. When buying real estate in Alabama, if the words “As Is” are used in the purchase agreement (sales contract), [Read more…]