Five Things to Legally Consider Before Purchasing Property


Now, purchasing property is a wonderful investment. Everybody wants a place that they can really call home and for those of you who already own a home, perhaps you are thinking of an investment property. But purchasing property is also plagued with many risks. 

Today, I want to point you to 5 things that you should consider before purchasing property. And to do that, lets consider this scenario about a young lady named Maria. I want you to identify the mistakes that she has made.  

Maria Purchases Property 

So, lets meet Maria,

She is interested in purchasing property in Kingston, Jamaica.

Maria gets the Newspaper and finds that there is a 3 bedroom house that is being sold in Mona. She calls the number provided and finds out that James is selling the property. James tells her that the property is a good deal and that he has been getting calls all day. However, he will only be entertaining the first person who makes a down-payment of $500,000.00. Quickly and Desperately not wanting to lose out on this opportunity, Maria gets James’ bank details and sends the down-payment to James’ bank account. Now, since making the down payment, Maria is demanding James to hand her the keys so that she can prepare to move into the property next week. Can you identify the mistakes that Maria has made?

Let’s Discuss

Maria made lots of mistakes. If you found any feel free to put them in the comments section of the corresponding youtube video. 

Here are five things to legally consider before purchasing property

Firstly Start with an Attorney – The first thing to consider is that as soon as you have a serious interest in purchasing a particular property, call and speak with an attorney. Your attorney will guide you as to what are the steps and stages involved purchasing property. I will do a video on this for your benefit so that you can understand what are the stages in putting your name on that title. So, there is a process in purchasing property and you want to ensure that you are doing the right thing and are not being taken advantage of.  So if Maria had engaged an Attorney, it’s highly likely that she would not have found herself in the complex situation she is in right now.

The second point speaks to the deposit. Don’t rush to pay the deposit. The next mistake that Maria made is that she paid the deposit before the Agreement for Sale was drafted and signed by both parties. If you pay a deposit before an Agreement for Sale is drafted you do so at the risk of proving that the deposit was pursuant to an Agreement for Sale for a particular property. For example, let’s suppose that the matter goes to Court and James lies and denies that the monies paid was pursuant to the purchase of land? Maria would then have the trouble of putting evidence together to show a judge for the said judge to believe that the deposit was indeed made for the purchase of property. So, it’s really sad when person’s come into office and say that they have made a down payment on the purchase of a property without an Agreement for Sale ever being drafted. Sometimes, cash is handed over and there is no receipt. That is double trouble right there. However, when you have a drafted agreement for sale, and the deposit is paid pursuant to that Agreement for Sale, then you really don’t have a problem with showing a judge, if it ends up in court, that the funds paid was pursuant to that Agreement for Sale.  

The third point speaks to verifying the Vendor’s Title. Now this is a BIG one. Not just a big one a HUGE ONE. Do you know that there are many persons out there who purchase land, and have not even checked the title. And listen to me very carefully, you can’t just check a copy of the title that the Vendor gives you to determine its accuracy. The Vendor’s title needs to be verified by doing the relevant checks at the Title’s Office. And I pause to say this that there  are people out there who have no legal capacity to sell property and are out there doing so. They may be a child of the deceased owner of the property who has not started the probate or administration of the will. However, they believe in their heart that the property belongs to them. In that case they have no legal capacity to sell the property and you can’t really be sure if you will ever get title. Also, you have scammers out there. So let’s be very careful. Your attorney will ensure that the vendor has the legal capacity to sell the property so as to avoid this problem.

The fourth point speaks to the Boundary Survey Report and Valuation Report. This is a two in one point. I always advise clients to get a boundary survey report so that you know where the actual boundaries are. If you are purchasing a ¾ acre property for example certainly you don’t want after the purchase to find out that it was a ½ an acre. Also, do a valuation report so that you can know the actual value of the property and know that you are not purchasing on the inflated value. After the sale has been executed, you have no legal recourse in getting back your money on the basis that what you paid for the property on an inflated value. So Maria did not get a valuation report or a survey report. She has therefore accepted the risk.

Lastly, Maria did not discuss with James that she wanted possession of the property before entering into the agreement for sale. So, the next point is that you should ensure that you discuss with your attorney what it is that you would like to  see in the Agreement for Sale. So, this really calls for you  to be open with your Attorney so that he or she can suggest or request amendments to the Agreement for Sale in order for it to be tailored to your needs. After an Agreement for Sale is signed, it may be quite difficult to get the other party to agree to something that was not included in the Agreement, and the other party has no legal obligation to agree with your request. So, because Maria did not fully pay for the property, she cannot expect to be granted possession until after she has paid the purchase price in full.

In the end, purchasing property is such a wonderful investment but its filled with lots of risks. I invite you to subscribe to the channel LegalChat Ja on Youtube so that you can learn more legal concepts. My goal is to help you through these videos to make more educated decisions.  

Until next time, let’s make more legally sound decisions

Kimberley Downer

Kimberley Downer

I am Kimberley Downer Attorney-at-Law and partner at the firm Grayson & Company, Attorney-at-Law located at Dairy, Discovery Bay, St. Ann. I have participated in several speaking engagements including a discussion topic, the ‘Legal Implications of Purchasing a Property and Estate Management’ with customers and employees at the Ocho Rios Branch of Scotiabank Jamaica.

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