top of page
  • Writer's pictureNathaniel Muller

Real Estate Q&A

Interview with Attorney Nathaniel Muller, as featured in Manhattan Profiles.

Real estate is probably the single largest asset most people own. How can using the right lawyer secure these assets?

Real estate is usually the largest purchase an individual will make in  his or her lifetime. Being properly advised and counseled is crucial.  Peace of mind for the client is the ultimate goal.  A good real estate lawyer will protect his client from any pitfalls and will advise on tax issues.  There are various scenarios depending both on the purpose and nature of  the purchase (main or secondary residence or investment property, condo,  co-op or house) and the status of the purchaser (U.S. or foreign  buyer). Lawyers who specialize in real estate are familiar with all  these situations and can guide you on how to structure the purchase or  sale of your property in order to maximize both the legal shield and the  potential tax consequences, whether during ownership or upon resale. Most importantly, the right lawyer will keep the communication with  his client open during the entire transaction (and afterwards should the  need arise). The right lawyer will make the transaction happen as  smoothly as possible and deal with all the details, alleviating the  stress that some—if not most—individuals experience during this kind of  transaction. Peace of mind for the client is the ultimate goal.   

What separate roles do a real estate agent and lawyer have?

A real estate agent will help you sell or buy, but is not qualified to  give legal advice. An experienced attorney will of course review the  contract of sale, the minutes and offering plan of the building if it is  a co-op or condo, but mainly, he’ll make sure the appropriate legal  structure specific to your needs and goals is put in place.  Additionally, there could be fiscal implications in any transaction and  the right lawyer will help you chose the right option for your  transaction whether you are an individual, a trust, a corporation or a  shareholder.   

What are the first steps to purchasing a home?

Before looking for a home the potential buyer should consider the following:  Will the house be used as a main residence, investment property or any other purpose?  Are you interested in purchasing a co-op, condo, or townhouse? There are  legal differences which we will be happy to explain to you.  If the purchaser intends to finance the property, he or she needs to be  pre-approved for a loan. Especially in Manhattan, because real estate is  a very fast market, a seller will not wait for a potential buyer to put  his paperwork in order.  Also, if one seeks to change the certificate of occupancy of a townhouse  into a multiple dwelling or a condominium offering plan, for instance, a  thorough analysis of the possibilities of the contemplated asset should  be undertaken very early on in the process.  

Do real estate lawyers advise on mortgage-related issues?

A real estate lawyer can help you find an experienced loan officer or  mortgage broker who will better assist you in obtaining a loan.  Once the loan is approved, your real estate lawyer will be in close  contact with the lender’s counsel and will assist in resolving any  issues that should arise in order to make the transaction happen as  smoothly and as fast as possible.  

Is it common practice to ask a prospective lawyer for references of satisfied clients?

An attorney is not allowed to give references because of the lawyer-client privilege and confidentiality requirements.  However, most of our clients are referred to us directly by previous satisfied clients.  

What are the three key questions a client should ask before hiring a lawyer?

1)”Who will be my point person? Will the attorney I am meeting with be my contact, or his paralegal or secretary?”  At our office, you will have one and only one interlocutor: your attorney.  2) “Do you practice anything else besides real estate transactions?”  The counterintuitive answer to this question is that an overspecialized  attorney may miss aspects specific to your transaction, because he does  not have a general view of the array of possible issues. For instance, a  good transactions attorney also practices litigation because he will  use his litigation experience to better draft transaction agreements,  and thus better shield his client. Likewise, identifying pitfalls and  potentially detrimental issues in a real estate transaction may require  knowledge of wills and estate law, corporate and business law, family  law or immigration law. This is true in all fields of law, but more  particularly in residential and commercial real estate transactions.  3)”Do you bill flat fees or by the hour?”  We use flat fees. There is no surprise fee for the client, and we prefer  simplifying, rather than unduly delaying and complicating a  transaction. Flat fees help achieve this goal.  

What complications can arise when buying and selling at the same time?

Buying and selling at the same time requires delicate timing. Sometimes  you sell before you buy or you buy before you sell. Anybody buying and  selling at the same time needs to be ready to find a temporary housing  arrangement between the two closings. But there are other options.  If you have sold your residence, but haven’t closed on your new dwelling  yet, you might want to negotiate a post-closing agreement with your  buyers (sort of a short-term rental). Please note, this is not always  possible with a co-op.  More rarely, a buyer can enter in a pre-closing possession agreement if  the residence he is purchasing is vacant and his current lease expired  or he already sold his former property. Again, this is rarely possible  in a co-op and requires the board’s approval in the case of a  condominium. Another issue is differing capital gains within the framework of a  1031 exchange. This is a tool used to differ payment of capital gains by  identifying and closing, within a specific timeframe, on investment  property or properties of at least the same value as the investment  property being sold.  

Can someone enter a contract without consulting an attorney?

There is no obligation to hire an attorney to review the contract of  sale, but this is very unwise and rare. The other party will generally  be legally represented and buying or selling without legal advice puts  you at risk of failing to identify issues that can potentially cost a  lot of time and money in the future. The attorney you hire will guide  you and protect your interests during the transaction. What is a title examination?  Title examination exists only for condominiums and houses or townhouses.  Co-ops have simple lien searches, because technically a co-op owner is a  tenant, while the physical ownership rests with the co-op, so there are  no title issues.  Title insurance will cover for all liabilities, title defects, liens and encumbrances attached to the ownership of a property, which have not  been detected by title examination. It is the responsibility of the  title company to research the title chain prior to closing, establish a  title report and then guarantee its report with a title insurance  policy. While not legally required, I am not aware of any transactions  that do not involve a title insurance policy.  While it is not common to have a challenge in the chain of title of  ownership of an apartment in Manhattan, there have been situations  where, on the morning of the closing, a seller drew on a line of credit  linked to the apartment ownership (thus creating an undetected lien on  the property).  I have also seen developers who inadvertently sold the land on which the  new construction stands, in addition to the specific unit being  purchased, multiple times—thereby potentially creating numerous claims  to the plot of land on which a building stands. Given the value of real  estate in New York, forgoing title examination and insurance is an  unreasonable risk.    

How long does a closing process generally take and what’s important to know in advance?

For a co-op, the rule of thumb is ninety days between the time a contract is signed and closing.  For condominiums, I have done closings within a week of contract  signing. It depends whether the apartment is occupied, board approval  process (if any) and the availability of the funds for closing.  

How important is it for a lawyer to understand how a client’s business works before taking his case?

Every individual is unique and every case has its own challenges. It is  essential for a good lawyer to understand his client, his personal and  professional situations, his strength and weaknesses and his present and  future goals to assist him and give him the best legal advice.  The communication between the attorney and client should be fluid and constant. It is a relationship of partnership and trust.  A good attorney does not work for his client. He works with his client.


Commenting has been turned off.
bottom of page