Legally Speaking

Buying a home, vacation home or condominium involves a significant investment of time and money. Consequently, you should make certain that your investment is well protected.

Under Wisconsin law, all contracts for the purchase of real estate must be in writing. Negotiating a real estate contract is usually initiated when the buyer submits an Offer to the seller. The Offer must contain all the necessary provisions to protect the buyer because the seller’s acceptance of the Offer will become a Purchase Contract and bind both parties.

The Purchase Contract is the most important document in a real estate transaction since it establishes the rights and obligations of the parties. The Purchase Contract often contains contingencies (and deadlines for meeting those contingencies) which must be met in order for the transaction to be completed.

The contingencies are usually inserted for the protection of the buyer and typically include financing requirements, a property inspection, a title report, a survey, etc. These contingencies permit the buyer to acquire as much information as possible about the property before obligating the buyer to conclude the transaction. It is not possible to determine all the factors that may affect the value of real estate simply by viewing the property or having it inspected or appraised. There may be easements or other restrictions or encumbrances on the property, adverse possession of part of the property by a neighbor, or lack of legal access to a road from the property; none of which would be evident without the information provided by a survey or title commitment, for example.

Without adequate professional investigation and assistance a buyer may pay too much for property, may not be able to use the property in the way the buyer hoped, or may not even be able to get to the property. Buying real estate involves great risk, but most of that risk can be avoided through proper planning and diligent investigation beginning with a well-drafted Offer.

This column is based on general principles of Wisconsin law, is for informational purposes only, and is not intended to provide legal advice. Each legal matter must be judged on the merits of it unique circumstances. If you have a legal problem, consult an attorney.