What can go wrong in attorney review? Plenty. The purpose of the review is to make sure the contract guarantees you rights and meets your specific needs. It is dotting the I’s and crossing the t’s.
- A lawyer reviews the articles and clauses in the contract during attorney review
- The attorney review usually lasts three business days
During this period, several things can go wrong, and most deals die during this period.
What is Attorney Review When Buying a House?
The Askin & Hooker Law Firm tells us that the attorney review is when the two parties have their lawyers review and modify the contract.
- It lasts three business days unless both sides agree to an extension
- Attorneys modify, add, and/or delete items relevant to the transaction
During this period, the two sides negotiate the terms of the agreement. The lawyers negotiate and set dates, set deposit money amounts, and deal with any other legal issues. At the end of this period the contract becomes binding on both parties. During this time, either party may back out with no consequences.
Can You Waive Attorney Review?
Some states do not use attorney review. Other states make it optional. Finally, in a few states, like New Jersey, you cannot waive it. New Jersey requires this clause in all contracts, but the law does not require either party to consult an attorney. If you are unclear about the laws in your area, you should speak to your real estate agent.
Can a Seller Accept Another Offer?
A seller may accept another offer during attorney review, and in a strong seller’s market this often happens. While the lawyers examine the contract it is not legally binding., Either the buyer or seller may terminate without penalty.
How Many Days is Attorney Review?
Attorney review typically lasts three business days. Business days include Monday through Friday, so if you sign a contract on Tuesday, the last day will be Friday. If you sign on Friday, then the last day will be Wednesday.
Can it Last Longer than Three Days?
Attorney review can last longer than three days. If there are complications with the deal, such as a disagreement on the size of the earnest money deposit, they may extend the period until they can resolve all the issues.
While both parties typically want to move forward quickly, some clauses may require more time and negation. As stated above, deposit money can be a sticking point. However, other issues often arise as well. A house sale contingency may slow the process, and deadlines may also force and extension.
Seller Delaying Attorney Review
The seller may delay the closing for a few reasons. If you are a buyer, you should be careful if you feel like the seller is stalling. The seller may:
- Get cold feet (buyers are not the only ones)
- Entertain another offer
- Have trouble finding a place to move
The law firm of Earl White has a good article about what should happen during attorney review. While there are many things that can hold up the process, if the seller delays for some other reason, you should be suspicious about his/her motivation.
Final Thoughts
What can go wrong in attorney review? Many things can happen, because the contract is not binding until after it ends. Either side may find another deal they like better. Also, a clause may present a problem. The seller or buyer may delay for various reasons.
The attorney review is meant to protect both parties, and it is a good idea to get a lawyer to examine it. After all, it is the largest transaction you are likely to ever make. Further, most buyers and sellers want to get on with the process as soon as possible. Therefore, most of the time attorney review is a little more than cooling off period. Afterwards, the contract becomes binding.
