INTRODUCTION: DIFFERENCES IN PRACTICE BETWEEN DOWNSTATE AND UPSTATE by Karl B. Holtzschue, Esq.

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3 09/03/03 NYSBA PRACTICAL SKILLS - PURCHASE AND SALE OF HOMES INTRODUCTION: DIFFERENCES IN PRACTICE BETWEEN DOWNSTATE AND UPSTATE by Karl B. Holtzschue, Esq. The practice with respect to purchase and sales of homes differs in certain key respects between downstate and upstate in New York. A survey by the Committee on Professionalism of the Real Property Section in 1999 found that ' practice north of Sullivan, Ulster and Dutchess Counties and parts of Greene and Columbia Counties (upstate) was different from practice south of there (downstate). "Report from Real Property Section Committee on Professionalism Concerning Executive Committee's Survey of Real Estate Practices and Interim Responses to the Survey", 27 N.Y. Real Prop. L.J. 79 (Spring 1999) _ The key differences were: TOpic Upstate Downstate Contract of sale filled out by; subject to approval of attorneys: reviewed by purchaser's att'y: Title search/insurance ordered by: Deed prepared by: Buyer represented at closing by: broker yes often buyer or seller provides abstract seller's att'y not applicable almost always buyer seller's att'y seller's att'y or lender's att'y buyer's att'y buyer's att'y or lender's att'y Other differences not covered by the survey are: Title insurance paid for by: Deed type : seller warranty buyer bargain & sale with covenant v. grantor acts Westchester County. One recent exception to this analysis is Westchester County, where, after a suit by the Westchester County Bar Association against a broker, the Bar Association and the Westchester County Board of Realtors have reportedly recently reached agreement that brokers may fill out information forms attached to the NYSBA-approved Multibar residential contract of sale and have them signed by the parties, subject to approval of the attorneys for -the parties. The forms require the brokers to deliver the materials to the attorneys for the parties. This compromise has apparently not been implemented. 3

4 Long Island. On May 28, 1999, the Long Island Board of Realtors, Inc. (LIBOR) sent a letter to the Nassau, Suffolk and Queens County Bar Associations (Brooklyn and Richmond Counties are now also involved) stating that LIBOR had mandated that an attached cont ract form be made available for use by brokers commencing October 31, The attached forms were a two page information and signature form (subject to attorney approval within five days and permitting the broker to hold the downpayment in escrow), a one page rider with six paragraphs on contingencies as to radon. hazardous materials, termite and home inspection, structural report, FHA & VA mortgages and possession and the NYSBA-prepared residential contract of sale form (Blumberg form 125). The forms are similar to the Westchester forms except that they do not require delivery to the attorneys. permit the brokers to hold the downpayment, and have an additional rider. The letter requested review and endorsement by the Bar Associations. According to the front page of the New York Law Journal on August , the Bar Associations are vigorously opposed, arguing that use of the forms without Bar Association approval would be unauthorized practice of law. While there is one set of course materials for this program for all locations in the state, an effort has been made to identify differences in practice between downstate and upstate areas. 4

5 08/09/07 PRACTICAL SKILLS - PURCHASES AND SALES OF HOMES REFERENCE MATERIALS The following publications contain information relevant to purchases and sales of homes ; Holtzschue on Real Estate Contracts & Closings (Practising Law Institute) (one volume, step~by ~ step analysis, checklists, cases, statutes, comprehensive index) Holtzschue, New York Practice Guide: Real Estate. "Purchase and Sale N, Chapters 1 6 (Matthew Bender) (multi volume, step- bystep analysis, checklists, forms, cases, statutes) Holtzschue. LexisNexisAnswerGuide: New York Real Property (one volume paperback on selling, financing and leasing) NYSBA's Residential Real Estate Forms on HotDocs (LexisNexis) (computer- assisted preparation of over 200 forms) dewinter, Real Estate Contracts and ConveYances in New York (Blumberg) (one volume paperback, contract analysis and cases) Pedowitz (ed.), Real Estate Titles. Second Edition (NYSBA) (essays on 27 topics) 5

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Contract Drafting and Negotiation. Karl B. Holtzschue, Esq. New York, New York

Contract Drafting and Negotiation by Karl B. Holtzschue, Esq. New York, New York 25 26 3. Contract Drafting and Negotiation by Karl B. Holtzschue, New York, NY A. Contract of sale forms Downstate (NYC,