I have spoken from time to time about the buyers' due diligence, but did you know the sellers should also engage in due diligence? Due diligence is a period of time where you have an obligation to act in some way. When due diligence is applied to residential real estate (a home) it means a period of time where either the buyers or the sellers should be doing something to making decisions about the property that will be for sale.

According to Investopedia "due diligence” is defined as follows:

1. An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to a sale. 2. Generally, due diligence refers to the care a reasonable person should take before entering into an agreement or a transaction with another party.

What should you, the sellers be doing during your due diligence time period? The good news for sellers is they control the time frame surrounding the sellers’ due diligence time period. Theoretically you can set the period whenever you wish, but from a practical standpoint the seasons set the parameters along with your level of desire to sell. As an example more listings take place in the spring than in the winter, but more contractors are probably looking for work in late fall to early winter than will be available in the spring. Of course replacing the front door in winter has its own hidden cost, a higher energy bill for one.

Think about the due diligence period as the time for you to act proactively in getting your home ready for staging and then for-sale.

How should you prepare for the sellers' due diligence? Well, for starters you need to decide when you would like to sell your home. Depending on how much work will be involved in getting the home ready to list you may need a month or as many as twelve months. It all depends on the extent of work you believe needs to be performed to get the house ship-shape.

1. Decide on the listing date.
2. Sit down and divide the house into sections. (Main area, upper level, lower level, exterior, garage, landscaping, swimming pool area, patios, decks, driveways, etc.)
3. Have each section of the home evaluated for major renovations. (Discuss what you can afford to do and what you can't afford to do. Discuss with a real estate agent those renovations that will add the most bang for the buck.)
4. Have each section of the home evaluated for minor renovations. (These are probably things you can do like painting, wiping down, staining, replacing electrical plates, etc.)
5. Have the home evaluated for staging. (Keep in mind just because you like it doesn't mean buyers will find it appealing.)
6. Create a list of all things in the home that you will not want to move to a new home, because you are going to sell these items.
7. Take photographs of the household possessions you will sell and locate user manuals and purchase receipts. (Place all paperwork inside a clear expandable or large Tupperware container. This way everyone knows where to find the right documents when a buyer shows up for a look-see.)
8. List these items on CraigsList and/or get ready for a weekend garage sale.
9. Whatever you don’t sell then either donate it or toss it out.
10. I have heard it said everyone has at least $2,000 of things they don't use stored in their garages, basements and attics.

The last thing you should do is the most important. Ask your real estate agent for a copy of the sellers’ real estate disclosure statement. Read it and make sure your appliances and home systems work properly.

If done right selling a home takes work and some money. If sellers do not do their due diligence then buyers expect to pay less than top dollar. And so do your due diligence, ignoring it will not make it go away.

HOW TO CONTACT US

The Lombardi Law Firm

5000 Westown Parkway, Suite 440

West Des Moines, Iowa 50266

Telephone: 515-222-1110

Fax: 515-222-0718

Write to Steve or Katrina

Email: sdlombardi@aol.com or katrina.schaefer8@gmail.com

The buyer's agent

Why do you need a buyer’s agent?

1. The listing agent represents the seller, not the buyer. The listing agreement contract binds the agent to the seller, not you, the buyer. Your interests are not being protected.

2. I am an attorney with over 30 years’ experience, AND I am a broker and a real estate agent in Iowa. I focus on central Iowa and specifically buyers who are willing to commit themselves to me as much as I do to them.
3. I represent only one set of buyers at a time who are looking in Polk, Madison, Dallas and Warren Counties.
4. I represent committed buyers who sign an exclusive agreement of representation meaning I commit to you as my clients and you commit to me, as your agent. Together we focus on getting you exactly what you want and at a price that makes sense to you.
5. This exclusive representation insures the elimination of agent conflicts with the sellers’ agent.

6. If you are ready to buy a new home that exceeds $300,000, let’s talk. I give my clients personal attention and I handle only a limited number of clients at a time.

Call 515-222-1110 to set up an appointment and talk with Steve Lombardi to see if he can help you buy the right house.

As Buyers What Are Your Duties Regarding The Iowa Residential Real Estate Disclosure Form

As a potential buyer of someone else’s home you have an obligation to protect yourself by doing certain things before making an offer to purchase. Iowa law goes only so far in protecting you as the buyer. The law cannot protect you from yourself. If you are lazy, don’t want to think or don’t care to investigate the real estate you buy then blame no one except yourself if you buy a lemon. As a buyer you do have certain duties that laziness will not excuse. 

Get used to the idea it may cost a little money now to protect you from having to spend a great deal more following the closing. It is better to spend a few hundred to investigate before closing, than to have to spend several thousand after the closing because the furnace didn’t work as you had anticipated. A leaky roof, a bad AC unit, clogged sinks or a poorly insulated attic can cost a new buyer considerably.

As the buyer what are your initial duties?

Buyers’ Duty

1. Get a copy of the disclosure.
2. Read the disclosure.
3. Ask questions of your agent.
4. If the agent won’t provide answers speak directly to the sellers.
5. If neither answers your questions, walk away from the deal.
6. Ask in writing for clarification.
7. If the disclosures are anything other than a “yes” or a “no”, then ask for a new disclosure form properly filled out.
8. If that is not provided, walk from the deal.
9. If you don’t like the answers you are getting or the answers are so vague they provide no useful information ask more questions.
10. If the answers still don’t answer your questions, walk from the deal.

HOW TO CONTACT US

The Lombardi Law Firm

5000 Westown Parkway, Suite 440

West Des Moines, Iowa 50266

Telephone: 515-222-1110

Fax: 515-222-0718

Write to Steve or Katrina

Email: sdlombardi@aol.com or katrina.schaefer8@gmail.com

Can I get sued if my agent says to simply mark ‘unknown” on the disclosure form?

Yes you can get sued for failing to make a disclosure if a defect in the property relates to that category. Here is a reason why this is likely. Let's say you bought the house and the furnace proved to be defective. The owners, not being HVAC professions thought they could get away with checking off "unknown" on the disclosure statement. After all they aren't qualified to know if the heat exchanger is cracked. So far sounds good doesn't it. 

But let's dig deeper. The owners knew the furnace was acting funny, it wasn't producing the right amount of heat and their heating bills were increasing. There were other signs but we don't need to go into all of them. 

What the owners did need to disclose was their knowledge about the furnace not working right. And their knowledge is not unknown, in fact they know enough that any reasonable buyer would suspect more investigation was necessary. An HVAC inspection for less than $100 would have discovered the cracked heat exchanger and the owners would have been required to spend the $1,000 to repair it. 

So what we have is a seller failing to disclose their knowledge about the furnace and that is a violation of Iowa law. 

As a lawyer, my advice to the buyers would be so to sue the sellers for failing to make any disclosure as to their knowledge of the defective furnace, water heater, water softener, roof leaking, windows leaking or any other defect in the home’s systems. 

I know what the sellers will say when the letter arrives from the buyers' lawyer asking for reimbursement of the HVAC repair bill. "But my real estate agent said I can mark ‘unknown’ on the disclosure form."

Whose advice should you follow? It doesn't matter what the real estate agent told you to do when filling out the disclosure form. That is legal advice and to my knowledge there are very few real estate agents and brokers in Iowa who are also licensed attorneys. Real estate agents are not permitted to give you legal advice. This is legal advice. That and they will probably deny ever telling you how to mark the disclosure form.

Make sense? If not call us for a consultation.

Is checking ‘unknown’ a legitimate disclosure answer for Iowa’s residential disclosure form?

No it is not a legitimate descriptive category of the owners' knowledge. After all, if the owners don't know what they know then who would? The who fills out the form is an owner with knowledge of the home. If they've never lived there then and have absolutely no knowledge of defects or repairs then the appropriate answer would appear to be "no". You are the owner and as an owner you are responsible to know the condition of your property. "I don't know" is not a legitimate answer because what you are disclosing is your knowledge of defects and repair. 

How can an owner not know what knowledge they have? It's absurd for an owner to say they have no knowledge of their knowledge.

Under Iowa law you have a duty to disclose what knowledge you have about defects. You either have knowledge of defects of you don’t. If you mark “unknown” you are failing to say if you do or do not have knowledge of a defect. So marking ‘unknown’ is a huge red flag to a lawyer and it is a failure to disclose your knowledge and that is a violation of the law. If the buyers came to me as a lawyer I would most likely advise them to sue the sellers for failing to disclose. And that is how I see "unknown" as an option - it's simply a failure to disclose.

Make sense? If not call us for a consultation.

You can buy, but not sell a house “As-Is”.

Buyers have a duty to disclose known defects. Sellers have no duty to read or to pay attention to what is being disclosed. So, you can buy a home on an ‘as-is’ basis, but as a seller you have to fill out a written disclosure form and deliver it to any buyer making an offer. If you don't then you're in violation of the law.

Make sense? If not call us for a consultation.

Buying A Home: Hey save all those purchase documents!

If you are going to buy residential real estate then you need to become as familiar with the process as you can. You also need to get organized and that means learning how to create a paper file that will support your side of the deal if after the deal is done it becomes undone. Paper is what will help protect you in the event you bought a house of cards or the proverbial money pit. So let’s discuss how to get organized.

Whenever you purchase a home you should start off organized and even after the sale is indeed done, stay organized by saving all the sale-purchase documents in a file folder.

Figure out which of you is better at organization and make it their job to keep the documents complete and available. That way there is no discussion later on about thinking the other was saving "those documents". Here are the tools you need.

1. Create a file folder with the address or name of your neighborhood.
2. The file folder should have multiple sections so you can divide the contents.
3. One section should be for what your agent gave you and another for what the sellers handed out.
4. Using a 3-ring binder, save all the owner manuals for the appliances and systems in the house.
5. In the home owner’s folder save all those purchase documents you were given, and especially the Iowa Residential Real Estate Disclosure Form.
6. Save the home inspection.
7. Save the real estate agent's business cards.
8. Pick up any business cards left on the counter, because they could later on become witnesses in your case.
9. Before closing make sure all the documents were signed and dated. Don't leave the closing without signed documents.
10. Keep a copy of the offer and acceptance forms that are exchanged.
11. Keep a copy of the sale’s brochure and materials.
12. At the closing require not just keys but owner manuals and if available copies of the purchase invoices for the various appliances.
13. At the closing require a list of vendors who have regularly serviced the real estate. (The plumber, pool company, heating & cooling company, roofer, siding, gutters, lawn irrigation company, electrician, etc.) You want to know who knows your home’s systems and how they work.

So get organized and stay organized. 

HOW TO CONTACT US

The Lombardi Law Firm

5000 Westown Parkway, Suite 440

West Des Moines, Iowa 50266

Telephone: 515-222-1110

Fax: 515-222-0718

Write to Steve or Katrina

Email: sdlombardi@aol.com  or katrina.schaefer8@gmail.com

How do I sell my house “as-is”?

Well first you read my blog post titled, As a seller is it legal to sell your house ‘As-is’?

Do you want to know what my answer is to that question? My answer is yes and no. You can sell your house ‘as-is’ so long as you make all the proper disclosures. In other words you can sell as is but you just have to tell the buyers what’s wrong with your house. They can assume all those nasty defect costs but you can’t sell without first letting them know via the disclosure statement what is wrong with it.

The problem is with how people think about their duties when they try to sell a house ‘as-is’. As-is doesn’t mean that as the seller you have absolutely no duties. It simply means the buyers buy without regard to defects. But that doesn’t change the sellers’ duty under the Iowa law. Seller still must fill out the disclosure form in an honest manner.

Make sense? It should. If it doesn’t call Katrina or I. We are both lawyers and I’m also a licensed real estate broker.

See Seller Disclosure Statements, Steve Lombardi

I’ll carry this on our two blogs, the Iowa Real Estate Lawyer on Blogspot and the Lombardi Law Firm blog titled The Verdict. 

As a seller is it legal to sell your house "As-is"?

This will be posted on the Lombardi Law Firm's website and I’m posting it here as well.

I was at a luncheon with central Iowa’s commercial real estate agents this past Wednesday and the subject of an ongoing lawsuit, residential real estate, came up. Bankers like to attend these luncheons because owners, buyers, investors and developers usually mean lending can’t be far behind. Seated at my table were some very experienced bankers from Des Moines. I consider them to be seasoned in the banking and lending business. Any banker that has made it through the crisis will be around for the long haul. But this day over the entree we discussed an ongoing lawsuit about a buyer suing over the sellers not disclosing defects in the home. The problem for these bankers was a critical misunderstanding about Iowa’s Residential Sellers’ Disclosure law.

It seems the sellers tried to sell their home “as-is”. The bankers are stymied about how the buyer can sue the sellers for defects when the buyer bought the property as-is. Everyone at the table wanted to blame the buyer for being too anxious to buy the home and the lawyers for making something out of nothing. Well, not everyone seated at our table thought this. Katrina Schaefer, Barbara (my wife) and I just smiled at those attempting to blame the sue-happy lawyers. I was quick to point out they were all incorrect in assuming that in Iowa anyone is ever allowed to sell a home as-is. There are a few exceptions, but this is certainly not one of them. You can’t do it so why even try to do it.

I start off engaging the bankers by making one simple statement that seemed to get everyone’s attention: In Iowa caveat emptor is dead.

They looked at me with bewilderment written all over their faces. Which is what I imagine is written all over your face too. This is a Latin phrase they teach in law school. 

What’s that caveat emptor stuff anyway?

Caveat emptor is a Latin phrase meaning “let the buyer beware.”

It was, but it’s no longer the law of the land in Iowa. In Iowa the legislature passed a law, requiring sellers of residential real estate to disclose material facts about their homes to potential buyers. And if you don’t you are setting yourself up to be sued – big time.

You have to make the disclosures in writing and they had better be accurate. Because if they are not accurate and the buyers experience problems, then you the seller will be required to pay to repair or to replace because you probably failed to disclose material facts about the home. While it's not a warranty, it is a duty to disclose material defects in the property for which there is a cost if you do not disclose. 

This whole as-is business is passé. You can’t sell residential real estate in Iowa without making material disclosures; PERIOD. So get that notion of caveat emptor out of your head because it will get you in trouble financially. 

And so if anyone is telling you to write ‘as-is’ into the deal don’t.

There is a case right on point where two real estate agent owners crossed out the disclosure questions with a nice big “X” and wrote on the form, ‘Seller never lived in the property’. But guess what that didn’t insulate them from being successfully sued. You can’t change the law just because you don’t like it or think you are somehow exempt. You aren’t and you can’t, so don’t try it.

You see, even professionals don’t understand what the law requires. What is required is a complete and truthful disclosure about anything material to the decision to buy.

Katrina and I have our own proprietary work-sheet and are trying to provide a valuable service to sellers and to buyers. Keep this in mind, if the sellers don’t hire us to assist them the buyers sure can after the sale when this or that doesn’t work or leaks or grows mold or whatever the defect might be.

You can read all about Iowa’s Residential Sellers’ Disclosure law at the Iowa Real Estate Lawyer, blog that Katrina and I write. You can also pick up some news from the Lombardi Law Firm website under real estate.

And if you have legal questions about the sale of your home, don’t hesitate to call Katrina or me to find out if we can help you. As many of you already know I am both a lawyer and a licensed real estate broker in Iowa and enjoy helping people solve problems. So unlike most real estate agents I can give legal advice. So call us at 515-222-1110 or send either of us an email: sdlombardi@aol.com or katrina.schaefer8@gmail.com. 

What went wrong in the Yeboah case?

Nepal, Khumbu Region of the Himalayas

The decision by the Court of Appeals of Iowa in Yeboah vs. Emans most certainly left the West Des Moines, Iowa homeowner-sellers dismayed. Everyone on the sell-side of that deal had to be scratching their heads and left wondering what went wrong. The sellers were left paying the buyers an additional $17,280.92 and then the Court remanded the case back to the Iowa District Court for an award of appellate fees. Obviously the amount the sellers would have to pay was higher than $18,000 and may have easily exceeded $20,000. Unfortunately for the sellers it’s doubtful any insurance policy covered this award; that money more than likely comes out of their pocket and in many instances will reduce the home equity they have to use to buy another home. In the end everyone involved had to ask how this could have occurred. I would guess even the buyers were left scratching their heads.

On that claim, the court found the sellers “had actual knowledge of the existence of a problem involving a leak in the roof of the sunroom” and failed to disclose the leak in their disclosure statement. [Page 3]

The buyers had to be wondering why they were paid for the leaky roof but not the leaky windows. Obviously this blog isn't the place to hash out all the problems with the disclosures so I won’t, but let’s discuss our solution for Iowa sellers.

Like all appellate court decisions we have little to go on except what is written in the decision. A court decision can’t fully describe all the facts; the court provides only those facts relevant to its decision. So I hesitate to extrapolate much from what is stated in the statement of facts, but with just those facts homeowners, sellers, buyers, agents and brokers must try and figure out what did go wrong.

A careful reading of the Court’s decision indicates the Iowa Supreme Court is critical not just of how the form is being used, but of the form itself. I'm critical as well and can easily understand the Court discussing the form in its opinion.

The form also included a list of questions and check-box answers under the heading, “Appliances/Systems/Services.” This portion of the form was designated “not mandatory” and only “for the convenience of Buyer/Seller.” Among the questions was a request for information about the condition of the windows. The sellers checked the box indicating that the windows were “[w]orking.” [Page 1]

Listen folks, the Iowa Supreme Court does not find this form as being adequate. Now I realize most agents aren't attorneys, I get that, but when your clients are being sued, a bell ought to go off in your head that something is wrong. That form everyone is using is terribly misleading.

Who provided that form? And who pray-tell wrote it?

Not even a home inspection uncovered the problems the subject of the alleged defects. That’s bothersome because the sellers and buyers had to be wondering why they were paying so much to so many professionals and getting so little in return. After all what are we paying for? It seems like the inspection amounted to telling them the obvious and then concluding with telling them what they could already see.

Six to eight weeks after closing, the buyers noticed wetness in the northeast corner of the sunroom and wetness in the drywall on the ceiling. Yeboah tore off a deck above the sunroom and found that one wall was soft. The buyers hired contractors to repair the damage. The total cost was $17,280.92. [Page 3]

Katrina, who is a lawyer in our office, summed up the allegations as a failure to fully disclose a leaky roof and damaged windows. This is one of the cases that made me aware of the need homeowners have as sellers for a lawyer to review and to assist them in how to properly fill out the disclosure forms. It made me re-examine the disclosure forms being used and to suggest additional disclosures along with how to position what needs to be disclosed.

The buyers also found that four of the windows in the home would not open. They obtained a replacement cost estimate of $4365. [Page 3]

In this case it’s too easy to simply blame the sellers for failing to disclose a known problem, because they did make disclosures of what they thought was a problem and they took corrective action on what was a leaky roof. I don’t blame the sellers for the disclosure statement but frankly I have to wonder why they didn’t seek legal advice to protect themselves from future claims. Were they told to seek legal advice? Were they told by a person or just in the fine print of one of the half dozen documents they were asked to sign? Take a step back and think for a moment about how this deal went wrong and how it could have been done differently to everyone’s satisfaction – do that and maybe they get paid a little less for the house, maybe they have some additional repair costs and maybe everyone walks away happy with their real estate agents and brokers. The way it worked out no one was happy and who knows what happened to the sellers and how they came up with the money to satisfy the judgment.

Here is what the Court stated about Iowa law: Iowa Code section 558A.2(1) requires a person interested in transferring real property to deliver “a written disclosure statement to a person interested in being transferred the real property.” This disclosure is to include “information relating to the condition and important characteristics of the property . . . including significant defects in the structural integrity of the structure.” Iowa Code § 558A.4(1). The seller is not liable “for the error, inaccuracy, or omission in information required in a disclosure statement, unless that person has actual knowledge of the inaccuracy, or fails to exercise ordinary care in obtaining the information.” Id. § 558A.6(1). A person who violates this statutory provision is ordinarily liable for the actual damages that the buyer suffers. Id. § 558A.6.

From my point of view the blame is easily spread around to all involved and had a more complete disclosure been made the issue would have been remedied for a lot less than what the sellers ultimately paid. And if you ask them today I'll venture to guess they would rather this deal had fallen through then to choose the way it ended after the court case.

This is a difficult part of selling your home, because no home is perfect, not even new homes. We read this decision and as a lawyer-broker I made the decision to restructure how we would do this portion of the deal. We offer this service across the entire state of Iowa, all 99 counties. We can do it via the Internet, phone and/or in-person. Contact Katrina and I if you would like assistance in filling out your disclosure statement.

Call us, contact the Lombardi Law Firm and ask for either Steve Lombardi or Katrina Schaefer. And if you are a buyer with a home disclosure problem we will represent you so long as we do not have a conflict of interest with having reviewed for the sellers.

HOW TO CONTACT US

The Lombardi Law Firm

5000 Westown Parkway, Suite 440

West Des Moines, Iowa 50266

Telephone: 515-222-1110

Fax: 515-222-0718

Write to Steve or Katrina

Email: sdlombardi@aol.com or katrina.schaefer8@gmail.com

Basements Are Often a Source of Concern in Older Iowa Homes

It is too often the case that homeowners focus on the main level of a house when looking to purchase real estate.  Understandably, the main level and second level are where most "living" occurs in a home.  Some people care little or nothing about the basement, except as a space to store items.  However, basement foundations, walls, and pipes are essential to the integrity of the house as a whole and are easily found in disrepair.  Homeowners sometimes neglect the basement condition or forget to care for it as they do the remainder of the house.  This leads to foundation cracks, leaks, and potentially severe water damage.  Older homes are more prone to these areas of disrepair, as materials used several decades ago either were not well-made or are deteriorating after many years of use.

When looking at real estate during your house hunt, it is imperative to closely examine the condition of the home's basement and foundation.  In many cases, water leaks have been repaired or damage has been covered up.  This does not mean the problem is "fixed" - you must be aware of what the problem was and what the potential issues may be in the future.  Even newer homes have the potential for water leakage and damage, especially in low-lying areas around Iowa that are subject to floods and heavy waterfall.  Check your property and the surrounding area for water drainage issues before you purchase your home.

I Thought They Said This Worked?

You are a home buyer. You bought the house, started turning it into your home and to celebrate invited over some guests for a nice dip in the hot tub. While you are fixing guacamole, your husband is turning on the hot tub. In less than one hour everyone will be here dressed in their swimming attire. Only problem is your husband just announced the hot tub doesn't work. 

On Monday the repairman shows only to hand you a bill for $1,700.00 to fix the internal parts that had been poorly maintained. You've owned the home for less than two weeks. 

What do you do?

Do you:

1. Pay the bill?
2. Call your agent?
3. Reread the sellers’ disclosure statement?
4. Send the disclosure statement over to your agent to present to the sellers?
5. Start a file for the other problems that may soon show up?

Actually you do all of the above and if no one wants to get out their checkbook, you end up calling a lawyer. That sellers’ disclosure statement is key to deciding who will pay the hot tub repair invoice. So pay attention to what is said in the Iowa Residential Real Estate Disclosure Form. And do so before you purchase a new home. 

My Realtor Is Telling Me Not To Worry About Disclosing Too Much

If your real estate agent discourages you from making a full disclosure that is bad advice. Your response back to your agent should be to put it in writing. I’m going to guess when you ask for that advice in writing you won’t get it. Why? Because it’s the wrong advice and your agent doesn’t want to be sued along with you if at a later time the defect turns into a claim by the buyer.

Your obligation is to disclose defects and when you know one exists you simply need to accurately disclose the nature of that defect. 

One area I find troublesome is when a defect existed, was fixed by the homeowner and the fix really didn't correct the main problem. Recent Iowa Supreme Court cases don’t seem to allow sellers to just fix the problem and then not disclose its nature. If a problem existed in the past it could be the sign of a larger issue and as the seller under Iowa law you have to disclose it. I think you have to be careful about how you analyze how to correct a defect because if you miss something you will pay for it at a later date. 

For buyers this is an important point to understand. 

So just doing a home repair is usually not the answer or a defense against a later claim. And failing to disclose because you believe it will not invite higher offers is like playing Russian roulette.

My advice is to disclose the nature of the exact problem and if we can help you contact Katrina and I at the Lombardi Law Firm.

HOW TO CONTACT US

The Lombardi Law Firm

5000 Westown Parkway, Suite 440

West Des Moines, Iowa 50266

Telephone: 515-222-1110

Fax: 515-222-0718

Write to Steve or Katrina

Email: sdlombardi@aol.com or katrina.schaefer8@gmail.com

Is checking off “Yes” enough to protect you from a lawsuit?

The quick answer is “NO”.

Why?

Because when you say yes you are indicating there is a problem, but a monosyllabic response discloses nothing about the exact nature of the problem. While checking yes may invite an inquiry from the seller; as a seller you have no idea how that will be understood or explained by anyone. The seller is the one with the duty to disclose which means you have to disclose the problem not just that there is a problem.

From a legal standpoint if caveat emptor is dead then so is hiding the ball. Buyers have a right to know what they are buying and if you know there is a problem with your real estate then you have to disclose the nature of the problem.

What is caveat emptor? It means let the buyer beware. In law it means the buyer has the obligation to make sure the property doesn't have defects. Check out Wikipedia and Merriam Webster's definition.

Now let me tell you what the yes means to a lawyer.

Yes means you the seller know there is a problem so that is an admission by the sellers, but that answer fails to disclose the exact nature of the problem. So thanks for the admission; now get out your checkbook.

As the seller of property you have an obligation to fully disclose the nature of the problem as you understand it and just saying there are issues isn't enough to avoid later being sued.

So disclose the nature of the exact problem and if we can help you contact Katrina and I at the Lombardi Law Firm.

HOW TO CONTACT US

The Lombardi Law Firm

5000 Westown Parkway, Suite 440

West Des Moines, Iowa 50266

Telephone: 515-222-1110

Fax: 515-222-0718

Write to Steve or Katrina

Email: sdlombardi@aol.com or katrina.schaefer8@gmail.com

Are the terms of that offer in the sellers' best interest?

We need to stop trying to dumb-down what we do for a living. I mean it. Are we not in this business to service clients? We are aren't we? I am and I hope you are as well. So when you hand the client the offer, how do you know if the terms of this offer are in their best interest? Is price and whether it is cash versus a loan the only two things you look at? Assuming that is all you look at and we know that is true 99% of the time then is that really a professional grade service? 

If I can teach a college freshman to do your job as well as what I have just described, why isn't your salary nothing more than minimum wage? Are you hearing me?

You can buy a flat-screen TV and get more service than what I have just described, so why are you getting paid 6%? Why aren't we being paid like a TV sales clerk? Consumers probably know more about the warranty on a $600 flat-panel TV than they do the Offer & Acceptance Agreement costing them more than $100,000. Does that make any sense to you? Not to me it doesn't.

When you look at the offer to buy and consider what to tell your client think LARGE! Think legal review because for most of your clients this is the largest purchase they will ever make.

Consider these ten points:

1.    What in the offer isn't good for sellers?

2.    When your agent, yes your agent, hands you this written offer on a pre-printed form do you ever wonder if there are terms in the offer that are not in your best interest?

3.    Most sellers look first at the price and the then the finance contingencies. But what else is in the offer that can later be used against you?

4.    Which terms of the offer aren’t in the sellers’ best interest?

5.    Which terms can you delete?

6.    If you delete terms and the buyers walk then what?

7.    What pressure placed on you by a real estate agent is misplaced?

8.    What amount of pressure placed on you is just flat-out wrong?

9.    Who is protecting your legal interests?

10.  And lastly, who isn't?

As a seller you need to know the terms of the offer aren't going to come back later and encourage litigation. You can't give legal advice but you can stress the advice that the buyer needs legal advice and that my friend is a professional service. And maybe this deal stalls and doesn't go through, but so what if they tell all their friends about what a great real estate agent you are. 

So consider hiring our law firm to assist you with the sale. Because I realize what you want is some simple formula that I put down on paper, you follow it and bingo the sale goes through. But if what you do, what we do, is as simple as a formula why do they need to pay us 6% to do it? Why aren't we just getting paid $100 as if it were a new car sale? Now do you get my point? This isn't simple, it never was and never will be and that is why you get 6% to divide between the four of you. When you ignore the need for a lawyer you are oversimplifying the real estate business and when we dumb it down sooner or later the FISBO deal looks like a better way to buy and to sell real estate.

This area of the law is a mine field – so don’t be the one who steps on a landmine. Call us, contact the Lombardi Law Firm and ask for either Steve Lombardi or Katrina Schaefer.

HOW TO CONTACT US

The Lombardi Law Firm

5000 Westown Parkway, Suite 440

West Des Moines, Iowa 50266

Telephone: 515-222-1110

Fax: 515-222-0718

Write to Steve or Katrina

Email: sdlombardi@aol.com or katrina.schaefer8@gmail.com