Ernie
Buying a home is one of the biggest financial commitments a person can make. While the closing process marks the final step in securing your property, it also comes with potential legal pitfalls that could turn your dream home into a costly mistake.
Eric Sander, a respected Chicago real estate attorney, has helped countless buyers navigate the legal complexities of home purchases. He shares some of the most common legal pitfalls buyers should avoid when closing on a home in Chicago.
1. Failing to Review the Purchase Agreement Carefully
Once a seller accepts your offer, you enter into a legally binding contract. However, many buyers make the mistake of signing the purchase agreement without fully understanding its terms.
What to Watch For:
- Contingencies: Ensure the contract includes inspection, financing, and appraisal contingencies to protect you if issues arise.
- Closing Costs: Verify which costs the buyer and seller are responsible for. Some contracts may have hidden fees that catch buyers off guard.
- Timeframes: Missing deadlines for inspections, mortgage approval, or other obligations could lead to penalties or losing the deal entirely.
“A poorly written contract can leave buyers financially exposed,” warns Sander. “Always have an attorney review the terms before signing.”
2. Overlooking Issues in the Title Report
The title report ensures that the property you’re purchasing has a clear legal ownership history. If there are any issues with the title, they must be resolved before closing.
Common Title Problems:
- Liens: Unpaid debts from previous owners can become the buyer’s responsibility.
- Easements: Rights granted to others, like utility companies or neighbors, may restrict how you use the property.
- Ownership Disputes: If multiple parties claim ownership, it could result in legal battles down the road.
How to Protect Yourself:
Sander advises buyers to purchase title insurance to protect against hidden title defects. “Title issues can delay closing or, worse, lead to future lawsuits. A thorough title search and title insurance policy offer vital protection.”
3. Skipping a Final Walk-Through
A final walk-through is your last chance to inspect the home before closing. Some buyers mistakenly assume this step is unnecessary, only to later discover undisclosed damages or missing appliances.
What to Check During a Final Walk-Through:
✅ Ensure all agreed-upon repairs were completed.
✅ Test appliances, plumbing, and electrical systems.
✅ Look for any new damage since the home inspection.
✅ Confirm that the seller has removed all personal belongings.
“Once you close, the home and any problems it has are yours,” Sander explains. “Take the time to make sure everything is in order before signing.”
4. Misunderstanding Closing Costs and Fees
Closing costs can add thousands of dollars to the total price of your home purchase. Unexpected fees can be a nasty surprise if buyers don’t carefully review their Closing Disclosure in advance.
Common Closing Costs in Chicago:
- Lender fees (loan origination, application fees, etc.)
- Attorney fees
- Title insurance
- Property taxes and transfer taxes
- Escrow fees
Sander advises buyers to review their Closing Disclosure at least three days before closing to ensure all fees are accurate and expected.
“Errors in closing documents are more common than you’d think,” says Sander. “It’s essential to review them carefully to avoid overpaying.”
5. Not Having Legal Representation at Closing
Illinois is an attorney state, meaning buyers are strongly advised to have a real estate attorney present at closing. While some buyers think they can handle the process alone, missing a legal detail can have serious consequences.
What a Real Estate Attorney Does at Closing:
- Ensures the final contract protects your interests.
- Reviews the mortgage agreement to avoid predatory lending terms.
- Confirms that title and ownership documents are correct.
- Identifies unexpected liabilities before you take ownership.
“An attorney’s role is to safeguard your rights,” says Sander. “From contract negotiations to closing paperwork, having legal counsel can prevent costly mistakes.”
6. Failing to Verify Homeowners’ Association (HOA) Rules
Many Chicago properties, especially condos and townhomes, are part of a Homeowners’ Association (HOA). Buyers often neglect to review the HOA’s rules, fees, and restrictions, leading to problems after closing.
HOA Considerations:
- Monthly or annual dues (and potential increases).
- Restrictions on renovations, pets, or rentals.
- Possible special assessments for major repairs or improvements.
“I’ve seen buyers close on a condo, only to find out they can’t rent it out or have a pet,” says Sander. “Understanding HOA rules beforehand is crucial to avoid surprises.”
7. Rushing the Closing Process
Many buyers are eager to close quickly and move into their new home. However, rushing through the final steps can lead to overlooked legal issues.
Why Taking Your Time Matters:
- Ensures all documents are reviewed for errors.
- Allows time for title issues to be resolved.
- Provides an opportunity to negotiate closing costs if necessary.
“I always advise my clients to slow down and double-check everything,” says Sander. “Closing is a legal process, and a little extra time can save a lot of headaches later.”
Protecting Your Investment
Closing on a home in Chicago involves more than just signing paperwork—it’s a legal transaction that requires careful attention to detail. Whether it’s reviewing contracts, ensuring title clarity, or verifying final costs, avoiding legal pitfalls is key to a successful home purchase.
Eric Sander stresses the importance of having a real estate attorney guide you through the process. “A home is one of the most significant investments you’ll ever make,” he says. “Taking the right legal steps now can prevent costly mistakes down the road.”
If you’re buying a home in Chicago, consult a trusted real estate attorney early in the process to safeguard your investment and enjoy peace of mind on closing day.
Visit https://ericsandersattorney.wordpress.com/ for more Eric Sander real estate tips.
