In New Jersey, most contracts to buy and sell residential real estate are prepared by real estate brokers or salespeople. The contract's purpose it to set forth the respective obligations of the buyer and seller during the transaction. However, in New Jersey, each contract prepared by a realtor must contain a clause allowing you to consult with an attorney within three days. For the buyer and seller, this is an important right that should always be exercised.
What is the attorney review period?
The attorney review period is the time when both the buyer and seller have the right to consult with an attorney, who can then review the terms of the contract, make changes, or "disapprove" (i.e. terminate) the agreement for any reason (or no reason at all). If the contract is terminated, the transaction is cancelled. All monies paid under the contract (e.g. deposits) are then refunded to the respective parties.
The attorney review period lasts three days and begins when each party receives a copy of the fully signed contract of sale. Weekend days and holidays do not count as one of the days of the review period. Additionally, the day that the buyer and seller each receive fully signed copies of the contract is not counted in the period. For example, if the buyer and seller receive the signed copies of the contract on a Thursday, the attorney review period would not end until the following Tuesday.
If neither the buyer nor the seller takes advantage of their right to have an attorney review the contract within the three-day period, the contract becomes binding on the parties as it is written, subject to the buyer's mortgage approval and satisfactory home inspection/title search results.
Why is it important to have an attorney review the contract?
In short, it is important for each party to exercise their right to the attorney review period in order to ensure that they understand the terms of the contract and to protect their legal rights. In New Jersey, although there is a basic "standard" contract used by real estate brokers or salespeople, one "size" does not always fit all situations. Since a given provision in a contract may be appropriate for one transaction, but not another, an attorney can identify any potential problems and ensure that each party's interests are adequately protected.
Since the purchase or sale of a home is likely the largest financial transaction you will undertake in your life, it is well worth the relatively small legal fee paid to ensure that your financial and legal rights are protected, and the transaction goes smoothly. The experienced real estate attorneys at Mariano & Coiro, P.C. can ensure that your best interests are represented and protected during every step of the process.