In the world of real estate, making deals comes as second nature. In spite of that fact, it is not uncommon for a partnership to get rocky and lead to the courtroom. When an agreement is not carried out properly, it can spell trouble for everyone involved. Take some advice from this commercial real estate attorney , and steer clear of these five common mistakes when you make your next deal.
1. Failing to get a lien. Under the Florida Commercial Real Estate Sales Commission Lien Act, brokers are permitted to impose a lien on the owner’s net proceeds to insure they get paid. Because the law has strict procedural requirements that must be followed, an experienced commercial real estate attorney can help you through the process, so make sure you contact one early on in your negotiations to make sure all your i’s are dotted and t’s are crossed.
2. Splitting commission with an unlicensed party. If someone is not a licensed broker in the state of Florida, that person is not legally allowed to get a percentage of the commission paid. Even if the person comes highly recommended or is licensed in another state, just say no!
3. Relying on verbal contracts. Verbal contracts are legally binding, but they are tricky. You are far better off if you have a written agreement to fall back on. Follow conversations up with a simple email to confirm, and take the time to draft up a written contract. Also, be sure to save any of these written agreements, including text messages. You will be happy you did when you are faced with a he-said-she-said debate in court.
4. Skipping the business valuation. If you are working with someone who is selling his or her business, a business valuation done by an expert in the industry is an absolute necessity. Think about it, it will only help you in the end to know if the value of said business adds to the value of the real estate in question. Do not overlook this important step.
5. Hanging on to the deposit. More than anything, staying away from serving as the escrow agent will save you the headache of being caught in the middle if there are disagreements between the seller and buyer. It is important that you remain impartial in these situations, so have the closing attorney or title agent hold onto the funds.
If you are entering into any real estate contract, you need an experienced West Palm Beach commercial real estate attorney on your side. Give our team a call today for the guidance you need to ensure your venture is successful.