Does the 3 day attorney review period in a contract apply to a Buyer who is an attorney but doesn't practice real estate law?

I am an attorney (do not practice real estate law and only remember the basics from law school) looking to purchase a new construction home with my non-attorney partner. The contract was drawn up by the builder and includes the 3 day attorney review clause. The process as I understand it is that the Buyer negotiates the price and options with the Seller and signs the contract, then once the Seller signs, the 3 day attorney review period begins. I know from reading the contract that there are several items that need to be changed. Should I sign it and then seek counsel from a real estate attorney to change it, or try to change the terms myself before I sign anything? If I changed the terms and signed it, wouldn't that negate the 3 day attorney review period?Can I do the closing myself?

Mount Laurel, NJ -

Attorney Answers (2)

Michael T Millar

Michael T Millar

Real Estate Attorney - Toms River, NJ
Answered

Technically, the three day attorney review period is only required in contracts that are prepared by a real estate broker (Opinion 26). The three day period begins to run when the fully executed contract is "delivered" to the parties.

Requesting changes prior to signing the contract would not negate the three day attorney review period. If it is a broker prepared contract, attorney review will remain. If, however, you are not dealing with a real estate broker but are instead negotiating directly with the builder or its attorney, then you may elect to delete the attorney review period from the contract.

My experience with new construction contracts is that the builder may negotiate price and delivery date - but will resist any substantive change to the form of contract. But, every builder is different and your results may vary.

The nominal cost of retaining an experienced real estate attorney to represent a buyer should make the decision a "no brainer". You could do the closing itself. However, if you have no experience in real estate matters, the old adage about the attorney who represents himself / herself applies. A transaction involving new construction can be much different than the sale of an existing home. There are limitations and additional concerns with new construction. I would recommend that you consult a friend or colleague who handles transactional real estate - including new construction.

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Christopher D. Ferrara

Christopher D. Ferrara

Business Attorney - Hillsborough, NJ
Answered

I agree with Mr. Millar.

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