08 Sep What ‘attorney review’ means in real estate
Q. I was in contract for a house and it was during the attorney review period. While our attorney was reviewing, the seller kept showing the house and actually accepted a higher offer and cancelled our contract. Can they do that? I thought the attorney review period was for the buyer’s benefit?
— Buyer (I hope!)
A. We’re sorry you lost the house.
Seems you learned the hard way that the right to attorney review belongs to both sides.
In New Jersey, after a contract for the sale of residential real estate is signed by both the seller and the buyer and a copy is delivered to the buyer and seller, the three-day attorney review period begins, said Anthony Vignier, a certified financial planner and attorney with Vignier Investment Group in Kearny.
“You typically have three days from receipt of the fully executed contract to have an attorney review the contract and accept it, or disapprove of it in order to make changes or cancel it completely if one side has second thoughts about the deal,” Vignier said. “If the contract is not disapproved within the attorney review period, you are bound by the contract as written.”
Vignier said during attorney review, a lawyer meets with the clients and will advise the client of his or her rights and responsibilities, and advise if changes to the contract are needed.
If there are changes to be made, the contract is disapproved and a letter is sent to the other lawyer for review. The other side is likely to request certain changes as well, Vignier said.
“After all changes have been considered and agreed upon by both sides, the contract is binding, if the parties can’t agree the contract is void,” Vignier said. “So yes, in this case, the seller was within their rights to cancel the contract.”
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This post was originally published in September 2017.NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.