If you are selling your condominium, you need to consider your plans first. Do you live in the unit? Are you moving out prior to the closing? Do you need the money from the sale to purchase another unit?
One problem that frequently occurs is a seller that needs to sell their current home before they can buy a new home. If you were to sign a contract to purchase a new home before your current home was sold, you could lose your down payment should your sale not succeed. Your down payment would be non-refundable if you were unable to close on the unit you were purchasing.
One strategy is to wait until your purchaser provides you with a copy of their own loan commitment letter. Once the commitment letter is received, many sellers sign their own contract to buy a home. A problem arises if you have no place to stay between the day you sell and the day you purchase your new home.
Basically, if you are thinking of selling your condominium unit, you should consult with an attorney before ever listing it. A good attorney should give you a few minutes of their time to understand your situation. They should also provide you with a little guidance. After all, you are going to sell your unit and will need an attorney.
The main reason for consulting a lawyer prior to listing the property is to ensure that you have a complete understanding of how this sale will affect your personal financial plan. For example, if you have been utilizing your condominium as an investment, you may be able to sell your condominium as an IRS Section 1031 Exchange and purchase a new property. A 1031 exchange allows you to defer any taxable gain until after the sale of your new property. One of the benefits of this strategy is that it permits investors to trade a single unit for a multi-family, or even commercial property.
One question most homeowners do not consider is whether or not any work has been done in the unit that required association or municipal approvals. If so, you should provide all of them to your attorney. If you did not get approval, don’t hide this fact. It could delay the closing by months in some cases. You should immediately work with your Realtor and attorney to legalize the work performed. This will allow you to sell the unit without undue delay.
Our system enables busy professionals and entrepreneurs to focus on what they do best. By focusing on their career or business, our concierge clients often earn many times more in new revenue than they pay for our legal fee. This enables you to buy or sell properties with minimal involvement and completely stress free. After the closing, we will wire your sale proceeds anywhere in the world that you direct, so that even receiving your money is stress free!
John has written an e-book, Big Apple Guide to NY Real Estate Transactions. It is available to answer questions that you may still have. Please provide your first name and email in the box below to download it now. We are attorneys and not salespeople. Nobody will ever call. There is no obligation. John simply asks that you email him to tell him what you liked or did not like about the book.