Day: April 2, 2015

By Parag Nevatia It’s amazing to see how people make this common mistake over and over again. Even worse is to see, more and more people doing this. What I am talking about is the absence of discussing a purchase transaction with a lawyer and avoiding some nightmares waiting to happen. Why do some buyers make contracts or letters of intent without legal guidance? What if some unforeseen issue pops up and the process gets delayed? Days become weeks, and weeks become months and suddenly the buyer faces a horrific nightmare, their down payment gets forfeited or donated to the seller. As an ex-banker, I have seen this a few times, and it shocks me and at the same time, I empathize with those who seem to not know better because they never get the guidance prior to setting off in the wrong direction. Sellers seem to be in such a rush to sell so they encourage the buyer to take a seller’s note instead, as they know a bank would probably not finance the project because of an obvious weakness in cash flow. Yet the sale price is usually set much higher than what the cash flow can support. I’m sure my banker colleagues will agree with this. Before the loan approval The problem is buyers don’t seek enough legal guidance to protect their deposit. First that deposit...