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Top Five Tips for Realtors to Avoid Breach of Contract
David H. Korman
August 10, 2023
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There are many issues and factors in the current residential real estate market that can prevent and/or delay closings. Breach of contract and the litigation that will follow is not a good result for any party to a transaction. In a recent Blog on “Challenging Closings” we discussed how in our law practice we focus on getting transactions closed in a timely manner using various strategies and options.
In addition to our efforts, the realtor plays a key role in achieving successful closings, and we are often providing advice and coordinating our efforts with theirs for the best interests of our mutual clients.
The following is a summary of the Top Five Tips for realtors to reduce the risk of a breach of contract:
1. Draft better agreements. Ask the Seller/Buyer pertinent questions regarding the property. Know the property, and know your client.
2. Time is of the essence. Irrevocable dates, title search dates, completion dates, deliverables (survey, reports, leases) dates, and condition dates must be strictly adhered to as to both the dates and the times.
3. Eliminate Mortgage Issues. Have a great mortgage broker on your team. Ensure that the Buyer obtains pre-approval with conditions that can be complied with prior to making offers. Know what the Buyer can really afford. Confirm bank appraisal results and steer clear of secondary appraisals.
4. Arrange for a bridge loan if clients are buying and selling, even if it might not be ultimately needed.
5. Get support from the lawyer for your mutual client at the earliest opportunity for reviewing surveys and status certificates, arranging for title insurance, drafting conditions, representations and warranties, and ensuring that the closing process is effectively communicated and implemented.
The coordinated professionalism and teamwork of the realtor and the lawyer is often the most crucial factor in the successful and timely completion of transactions.
If you are a Realtor, please feel free to reach out to us with your questions or thoughts. We would love to hear your opinion! Contact us at (905) 270-6660 or e-mail: Info@kormans.ca
David is a member of the Law Society of Ontario since his call to the bar in 1985. David has over 35 years of extensive experience as a lawyer in residential and commercial real estate transactions, commercial leasing, corporate and commercial transactions, and private and institutional lending. His client base includes individuals, business entrepreneurs, developers, financial institutions, brokerages, and real estate investment trusts.
David takes an amiable and dedicated approach to practicing law. His focus is on providing his clients with the highest levels of legal service. Clients love working with David, as he always works hard in their best interests with a smile on his face. David’s sports background and leadership skills are highly influential on the growth and success of Kormans LLP as he truly believes in fostering the Kormans LLP environment as both a family and a team!
When David isn’t closing real estate and corporate transactions, David is an avid runner, hiker and sports enthusiast. However, what David enjoys most is spending quality time with his wife, kids, grandkids and friends at home, at the cottage, and on travels.
David is a frequent blogger, as well as a lecturer and panel member at seminars, webinars and workshops for real estate agents, mortgage brokers and home buyers. Please make sure to catch “David & David on Real Estate” – David’s featured Podcast which can be heard on RadioPublic, Spotify, Breaker, Anchor and Google Podcasts, and can be viewed on the Kormans LLP YouTube channel!
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