Homebuyers - Know Your Legal Rights to Prevent a Bad Deal

Buying a home, whether for the first time or the fifth, it can be an intimidating and leave you feeling anxious. Did you make the right choice? Are you getting the best price and rate? Questions swarm your mind and may even keep you up at night.

To make you feel a little more at ease and more confident about buying your little piece of real estate, you should know that you do have rights as a homebuyer. Federal and state laws exist to protect you from a variety of possible pitfalls and save you some money in the long run.

First and foremost, if you are conducting your purchase with the aid of an agent, his obligation is to you. He is required by real estate law to serve your interests, protect your privacy and get you the best deal legally possible.

To avoid problems, interview potential agents to make sure your personalities don’t clash. You will be working closely with this person and if you feel unimportant to him or simply don’t like him, it is not going to work.

As a buyer, you also have the right to full disclosure of known or possible defects in the home. Some of the things that fall under this disclosure agreement are issues with the foundation or structure, plumbing and drainage problems, termites, electrical and title issues.

With the discovery of a correlation between health problems and lead-based paints, full disclosure of these materials in the home are required under the Residential Lead-Based Paint Hazard Reduction Act of 1992. If the home you are interested in was built after 1978, lead-based paint shouldn’t be an issue, but you can have it tested if you are unsure. Under this act, the presence of asbestos and radon must also be revealed.

You are also protecting from discrimination under the Fair Housing Act of 1968. This law states that neither sellers, agents or finance companies can deny leasing or selling a property based on someone’s race, gender, religious affiliation, marital status, handicap, ethnicity or the make-up of your family.

As for financing the home, the Real Estate Settlement Procedures Act (RESPA) and Homeowners Protection Act of 1998 (HPA) give you additional legal rights. RESPA requires full disclosure of fees and charges from the finance company and works to eliminate unscrupulous practices that take advantage of the borrower.

HPA deals with the private mortgage insurance (PMI) that is everyone has to pay if they are unable to put a minimum of 20% to put down. This act allows the buyer to cancel the PMI once the mortgage has been paid down by 20%. So, down the road, you can drop the expensive insurance that is tacked on to your Louisiana real estate mortgage.

These acts give you recourse throughout the process of purchasing of real estate. If you feel any of your rights are being abused, you can contact an attorney who specializes in real estate law before you sign any contracts. Hopefully it is a rare occurrence that these laws are broken, but knowing your rights makes you better prepared to recognize when it is happening and what you can do about it.