Los Angeles Real Estate Contract Lawyer
Serving Clients in Los AngelesVentura and Orange Counties
When a buyer prepares to purchase a home, they enter into a real estate contract that is a legally binding document governing the entire transaction. Real estate contracts are used in the rental, sale, or purchase of a piece of real property. Real estate contracts are used in residential and commercial transactions. When a property is under contract, all parties are required to act in accordance with the contract, or the other party to the agreement could be awarded damages in court.
The Parties in a Real Estate Contract
A real estate contract has a purchaser and a seller. The purchaser is the party planning to buy the property in the contract. The seller is the current owner of the property planning to sell their home, land, or business. If the real estate contract is for a rental property, it has a lessor and a lessee. The lessor is the party planning to lease the property to another person. The party planning to lease the property is the lessee. The names and descriptions of the property being rented or sold are included in a real estate contract. The price the buyer and lessee plan to pay is also highlighted in the sales or rental contract.
When a Party Breaches a Real Estate Contract
If a real estate contract is breached, the other party can file a lawsuit in court for money damages. The non-breaching party can also sue for specific performance to force the other party to proceed with the sale. In California, most real estate contracts require binding arbitration instead of a lawsuit.. Financial compensation is the compensation that the non-breaching party lost because of the breach. The judge will review the case and determine monetary damages or whether there should be a forced sale. Fair market value is used to develop a range for damages. The property's fair market value is determined by what a buyer is willing to pay to a seller if there were no deal on the table.
Fair Market Value is determined using factors like:
- Current Use
- Appraisal Value
- Property Condition
Once a real estate contract is breached by the buyer, the seller can receive monetary damages measured using a formula equal to the contract price less the fair market value. In some instances, the seller can breach the contract by promising to make changes to the property, and then the buyer finds the property has not been delivered as stated. If this happens, the buyer could be entitled to pursue damages.
Rental or leased real estate contracts can be breached, too. If a lessee doesn't pay the contracted rent on the due date, they could breach the contract. Many rental real estate contracts have stipulations for lessee breaches that require, for example, a fee of all back rent and a flat fee as a penalty. The lessor could be in breach of the contract if the property were delivered in an uninhabitable status. If the property is unsafe and injury occurred, damages may be awarded for any related harm.
Los Angeles Real Estate Contract Attorneys
If you are a party to a real estate contract and the other party is in breach or claims you've breached the contract, a Los Angeles real estate attorney can help you navigate the process and prepare a complaint or arbitration demand to defend your position in court or arbitration. At the Law Office of Steven R. Lovett, clients can schedule a consultation with our Los Angeles real estate contract lawyer to review the details of your situation.
Call our offices at (888) 577-1518 for an appointment.