Sometimes, even the most straightforward real estate transactions can result in disputes that require legal action. The process of buying and selling real estate is not always strictly business. Homeowners are notoriously sentimental about their properties, and often feel that their personal investment in their homes leads to a higher property value. It's important for both parties to understand which resolution methods are most effective for their particular situation.
Common real estate disputes
Real estate disputes are common, and they can often be easily addressed when a qualified attorney is helping with the transaction. These are some types of real estate disputes that you may encounter:
- Breach of Contract — This is perhaps the most common type of real estate dispute, as it covers a wide variety of issues that arise. The purchase agreement is the contract that a seller makes with a buyer, and all clauses within the purchase agreement must be abided by.
- Inspection Disputes — After a buyer has an inspection on the property, there is sometimes disagreement about who should cover which repairs.
- Fraud — Real estate fraud occurs when a buyer or seller misrepresents themselves purposefully during the transaction.
Mediation and arbitration: the most effective options
If a real estate dispute cannot be resolved between the two parties on their own, lawyers are often called into action to help negotiate the matter. According to The Balance Small Business, mediation and arbitration are the most affordable and least time-consuming options. Mediation is the shortest dispute resolution process, and generally lasts about a few hours. A mediator will work with both parties to attempt to negotiate a favorable conclusion. If mediation is unsuccessful, both parties often agree to take the situation to the next step. Arbitration is a longer process than mediation, as it requires an investigation into the circumstances and a panel to deliberate on the final agreement.
What to do when mediation and arbitration aren’t possible
In many cases, either mediation or arbitration will resolve a real estate dispute. However, there are some cases where further legal action is required. Litigation is generally necessary when the case becomes increasingly complex or it involves boundary issues that cannot be resolved through mediation or arbitration. Any real estate dispute that alleges criminal conduct on the part of one or more parties will also require litigation. Luckily, however, most real estate disputes can be resolved between agents or through mediation and arbitration.
Whether you are a real estate investor who frequently purchases new properties and sells others for a profit, or you are a homeowner searching for your next place to live, it's important that you have a qualified attorney on your side to help you finalize your real estate transactions. Incorporating mediation or arbitration clauses into your real estate contracts can help minimize frustration and improve results throughout the transaction.
For more information on real estate law, contact one of our qualified attorneys today.