Real Estate Law
Real estate transactions are governed by a wide body of federal statutes and state statutory and common law. The requirements established by state law differ significantly from one state to the next.
Real estate brokers are employed as an agent of the seller in order to obtain a buyer for their property. The contract between the broker and seller is called a listing agreement. Real estate brokers and salespersons are licensed and regulated by local state laws. Professional organizations may also provide further guidelines. The Federal Fair Housing Act prohibits discrimination in real estate transactions on account of race, color, religion, sex, or national origin. Real estate brokers are specifically prohibited from discriminating by the act.
The agreement to sell between a buyer and seller of real estate is governed by the general principles of contract law. The Statute of Frauds requires that contracts for real property be in writing. A title insurance company is often employed to investigate whether the title to the property is marketable. Title insurance companies also insure the buyer against losses caused by the title being invalid. In order to pass title, a deed with a proper description of the land must be executed and delivered. Some states require that the deed be officially recorded to establish ownership of the property or provide notice of its transfer to subsequent purchasers. The most common method of financing real estate transactions is through a mortgage.
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