The Difference Between Commercial and Residential Real Estate Closings
The real estate law firm of Magnolia Law in Fort Lauderdale, Florida, is explaining to the public why commercial real estate closings are much different from residential real estate closings.
(Fort Lauderdale, FL October 2021) When a Fort Lauderdale resident decides they want to buy or sell a piece of commercial property, they need to be aware of all the differences between a standard real estate residential closing and a commercial real estate closing.
For commercial real estate closings, it is imperative that the buyer hires an attorney to protect them because commercial real estate closings are extremely complex. There are many pitfalls that can be avoided if the buyer hires a commercial real estate closing attorney who is highly experienced and knowledgeable regarding Florida real estate laws.
The first way that a commercial closing differs is escrow. People who have bought a home before know about escrow, but that kind of escrow is very informal. In the case of a commercial closing, escrow is much more formal and complicated. Larger sums of money are involved, and money may be coming from several different sources.
The closing attorney will have to make sure escrow is set up properly so that the money is protected properly if anything falls through.
The second way that commercial real estate closings are different is by legal entities. Usually, in a commercial closing, the property is being bought and sold by legal entities rather than by private individuals.
Investors and buyers set up these legal entities because commercial closings involve a great deal of money. Naturally, everyone involved wants to limit their liability if things go awry. Both the buyer and the seller usually set up a corporation for themselves, or an LLP, or an LLC, that is used only to own the real estate.
It’s easy to see why it’s so important that buyers hire a Fort Lauderdale lawyer for commercial closings. When people set up a corporation to own a piece of commercial property, it helps protect them from losses. If the corporation gets used, the individuals only lose their investment, they don’t lose their own personal assets.
Another difference in commercial real estate closings that will require the attention of a knowledgeable closing attorney is the paperwork that is involved. Even though both parties have probably created a corporation or an LLC, there still must be someone signing the paperwork. The closing attorney will have to take all the legal steps necessary to make sure that the person signing the closing paperwork actually has the authority to do so.
About Magnolia Law – The Real Estate Closing Firm
Magnolia Law was founded on the core principles of compassion, integrity, resilience, and fortitude. The real estate attorneys at Magnolia Law specialize in handling all aspects of residential and commercial real estate closings. They provide free consultations to evaluate each client’s individual case. Whether you are purchasing a home, refinancing your loan, or buying investment property, a real estate attorney at Magnolia Law in Fort Lauderdale can handle your closing. The real estate lawyers in the firm serve brokers, realtors, lenders, developers, mortgage brokers, builders, lawyers, investors, buyers, and sellers throughout the entire state of Florida. The firm is also a proud member of The Fund – a division of Florida’s largest title insurance underwriter, Old Republic Title.