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Steps Attorneys Take When Reviewing a Purchase Agreement in New York

Buying or selling real estate in New York involves more than just signing papers; it requires careful legal scrutiny, especially during the attorney review period. Many buyers and sellers are eager to understand what happens during attorney review and how attorneys safeguard their clients during this crucial stage. In New York, this review not only ensures clarity and fairness in the agreement but also opens the door for essential modifications before the deal becomes binding.

1. Initial Review of the Purchase Agreement

Once the buyer and seller have signed the initial version of the purchase agreement, the document is sent to their respective attorneys. The first task a lawyer undertakes is a thorough examination of the contract for accuracy, clarity, and compliance with New York real estate laws. This involves verifying the identity of the parties involved, double-checking legal property descriptions, and ensuring that timelines and contingencies are clearly outlined. This is the first step in understanding what happens during attorney review. Attorneys are not just looking for legal red flags; they are ensuring that their client’s expectations and interests are properly reflected in the written terms of the contract.

2. Assessing Contingencies and Financial Clauses

Contingencies are essential parts of any real estate deal. These clauses allow a transaction to proceed only if certain conditions are met—such as financing approval, satisfactory home inspections, or the sale of another property. Attorneys review these clauses closely to determine whether they are written in a way that protects their client from premature commitment or unintended risk. For instance, a financing contingency ensures that a buyer is not held liable if they cannot secure a mortgage by a specific date. If this term is missing or unclear, the buyer could face legal complications. Understanding what happens during attorney review highlights how lawyers tailor these clauses to suit specific client needs and prevent future disputes.

3. Reviewing Title and Property History

Another crucial component of the attorney’s responsibilities is to request a title search on the property. This investigation checks for unresolved liens, easements, or property boundary issues that could complicate the sale. If the title search reveals any encumbrances, the attorney will either negotiate their removal, address them through title insurance, or advise their client accordingly before proceeding. What happens during attorney review includes ensuring that the buyer will receive clear ownership of the property. This step is vital for identifying legal problems that could affect ownership rights or property value down the line.

4. Proposing Modifications to the Agreement

Once both attorneys have identified areas requiring clarification or improvement, they engage in a formal negotiation process. This may result in proposed changes to the contract's wording, deadlines, or responsibilities of each party. Communication between attorneys during this phase is crucial, as both parties work to fine-tune the agreement into something mutually acceptable. This exchange of drafts and revisions is a hallmark of what happens during attorney review. Neither the buyer nor the seller is legally bound by the initial contract until both parties' attorneys have agreed on the modified terms and formally accepted them in writing.

5. Finalizing the Contract and Moving Forward

Once all concerns have been addressed and any proposed changes agreed upon, a final version of the purchase agreement is prepared. Both attorneys confirm that all legal language conforms to New York state laws and that their clients fully understand the obligations outlined in the document. At this stage, the contract becomes legally binding, and any backing out could have financial or legal consequences, depending on the agreed-upon terms. Finalizing the deal is the culmination of what happens during attorney review. It marks the end of a critical period in the transaction where legal guidance helps minimize risks and clarify the path ahead for both buyer and seller.

Conclusion

The attorney review period in New York real estate transactions is a time-limited but powerful tool for legal and financial protection. Understanding what happens during attorney review allows buyers and sellers to appreciate the level of due diligence that occurs before a contract is solidified. From reviewing contingencies and title history to negotiating modifications and finalizing the agreement, attorneys play a crucial role in guiding their clients through one of the most important financial decisions of their lives. This systematic legal process ensures that both parties enter into the deal with transparency, fairness, and confidence.

Do Both Parties Need Attorneys for Review in New York Real Estate Closings?

In the complex world of New York real estate transactions, one critical phase that both buyers and sellers encounter is the attorney review period. This step plays a significant role in the overall process of closing a real estate deal. Given the legal implications and potential financial impact, a common question arises: do both parties need attorneys during this stage? To answer that, it’s essential to understand what happens during attorney review and the advantages legal representation provides to each side.

The Role of Attorneys in the Review Process

In New York, hiring an attorney for a real estate closing isn’t just a recommendation—it’s a practical necessity. Once both the buyer and seller sign a proposed contract, the document enters a preliminary phase where it is not yet binding. During this window, attorneys from each side have the opportunity to scrutinize the contract and either approve its terms, propose changes, or cancel altogether. Understanding what happens during attorney review is crucial here: attorneys examine the agreement to ensure it aligns with their client's best interests and complies with local laws.

This legal safeguard ensures that both parties are making informed decisions. Without proper review, either side risks committing to terms that may carry hidden liabilities or lack adequate protections.

Protections Offered to Buyers

For buyers, retaining an attorney can serve as a vital shield against unfavorable terms. Buyers’ attorneys typically assess clauses pertaining to financing contingencies, home inspections, closing dates, and included fixtures or appliances. They also review disclosure documents and often request modifications to better protect the buyer’s investment.

A major part of what happens during attorney review includes identifying ambiguous language that could potentially shift responsibilities unfairly to the buyer. If issues arise—such as title complications or unclear repair conditions—the buyer’s attorney can request changes or back out of the agreement without penalties, provided it’s within the review period.

Why Sellers Also Need Legal Counsel

Sellers might feel that retaining an attorney is optional, especially if they believe the standard contract suffices. However, sellers benefit just as much from having legal representation during this phase. Their attorney ensures the contract protects them against future liability by clarifying conditions related to disclosures, deadlines, and potential penalties.

What happens during attorney review may include modifying or rejecting unreasonable demands from the buyer's side. Sellers’ attorneys also help set clear boundary lines for compliance with local disclosure laws, protecting their clients from potential lawsuits after closing. Without this oversight, even well-meaning sellers may unknowingly agree to risky terms that could haunt them later.

Harmonizing the Process Through Legal Negotiation

During attorney review, the dialogue between the attorneys serves to fine-tune the contract. This back-and-forth ensures both parties agree on a final version that meets mutual satisfaction. Without attorneys on both sides, this negotiation process becomes lopsided, increasing the chances of disputes or cancellations.

Another important aspect of what happens during attorney review is how both parties pinpoint and correct errors in the contract. Even minor mistakes in closing dates, transaction terms, or property descriptions can delay—and sometimes derail—the deal entirely. Attorney-to-attorney communication helps keep things professional, structured, and solution-oriented, reducing tension between buyer and seller.

Legal Requirements vs. Practical Necessity

Interestingly, New York law does not explicitly require both parties to have attorneys for a real estate transaction. However, because of the state’s unique three to five business day attorney review period and the legal complexity of property transfers, most realtors and brokers strongly advise both buyer and seller to secure legal representation.

When considering what happens during attorney review, it's evident that the risk of proceeding without a lawyer far outweighs the cost savings. The consequences of signing a flawed or poorly negotiated contract could result in financial loss, extended litigation, or even forfeiture of the property. Attorneys in New York are not just facilitators—they act as gatekeepers for a fair, enforceable agreement.

Conclusion

While it’s not a legal requirement for both parties to have attorneys in New York real estate closings, it is strongly advisable. Understanding what happens during attorney review highlights why legal guidance is crucial on both sides of a transaction. From reviewing financial contingencies and property disclosures to negotiating fair terms and ensuring compliance with New York regulations, attorneys are indispensable. Their presence not only levels the playing field but also paves the way for a smoother, faster, and more secure closing process for everyone involved.

Legal Consequences of Skipping Attorney Review in New York State

Buying or selling property in New York is an intricate process, and one of the most crucial steps involves the attorney review period. For both buyers and sellers, understanding what happens during attorney review is fundamental to protecting your legal and financial interests. However, some parties opt to skip this step, either for convenience or from misjudging its importance. Doing so can lead to serious legal consequences that may not become evident until much later in the transaction—or even after the deal is done.

What Attorney Review Really Entails

In a typical New York real estate transaction, once both parties sign a proposed contract, the deal enters a short period, generally three to five business days, during which each side’s attorney reviews and may propose changes or cancel the contract altogether. What happens during attorney review is far more than just a casual glance at the paperwork. Attorneys examine the contract for accuracy, fairness, and compliance with state laws. They may negotiate modifications to clarify obligations, timelines, or contingencies.

This step ensures that neither party is locked into unfavorable terms and that all legal and procedural issues are addressed before the contract becomes binding. Without attorney review, hidden liabilities can go undetected, leaving one or both parties exposed to future disputes or financial loss.

Risk of Binding an Unfavorable Contract

One of the most immediate risks of skipping attorney review is becoming legally bound by a contract that contains inaccurate, harmful, or incomplete terms. Especially in fast-moving markets, buyers eager to close quickly may rush to sign without ensuring their interests are protected. Without a proper understanding of what happens during attorney review, some might overlook common pitfalls such as vague contract language, unreasonable contingencies, or hidden fees.

Once the attorney review window has expired or is bypassed altogether, modifying the contract becomes extremely difficult. Parties could find themselves obligated to terms that offer little room for exit, even if the deal turns out to be financially or legally problematic.

Lack of Legal Recourse for Errors or Omissions

The attorney review process often reveals issues that are not immediately visible to the layperson. Whether it's zoning restrictions, title encumbrances, or dispute-prone clauses, what happens during attorney review includes identifying and correcting these problems before final commitment. Skipping this step often leads to overlooked errors or omissions that may only be discovered after closing, at which point correcting them requires legal action, time, and additional expense.

In extreme cases, buyers may find out that the property has unresolved legal claims or structural issues that invalidate key parts of the purchase agreement. Without having had legal counsel to catch those red flags during review, the buyer bears full responsibility for due diligence failures.

Difficulty in Exiting the Transaction

Another vital part of what happens during attorney review is preserving each party’s right to cancel the contract without penalty. If either party identifies a deal-breaking issue, they can back out gracefully within the designated period. Skipping attorney review removes that safety net. Any withdrawal after signing the contract could trigger breach-of-contract claims, potentially resulting in instant financial penalties or lawsuits for damages.

This is particularly dangerous for sellers who might wish to accept a better offer or for buyers who discover they no longer qualify for financing. Without attorney review, the window to reconsider closes prematurely, and penalties can escalate quickly thereafter.

Long-Term Legal and Financial Fallout

Failing to understand what happens during attorney review can ultimately lead to broader legal and financial problems. If post-closing disputes arise regarding contract obligations or property conditions, the lack of an attorney-reviewed contract makes it harder to litigate or resolve those issues. Courts often rely heavily on signed agreements, and if they contain vague or poorly drafted terms, it becomes difficult to defend your position.

Moreover, unexpected costs such as unpaid property taxes, undetected liens, or undisclosed property defects often emerge after skipping thorough legal review. These complications not only diminish the value of the investment but may also create long-term obligations that could have been avoided.

Conclusion

The attorney review period exists for a reason: to protect both buyers and sellers from entering into ill-advised or legally harmful agreements. Skipping this phase not only eliminates the chance to make valuable corrections to the contract but also exposes all involved to avoidable risks. Understanding what happens during attorney review can mean the difference between a smooth transaction and years of lingering legal problems. In a state as legally complex as New York, choosing to bypass this critical step is not just a shortcut—it’s a gamble with potentially high stakes.

Sishodia PLLC

Sishodia PLLC

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