The COVID-19 pandemic changed the way we do business. Many shifted from the office to a work from home setting. Business operations and negotiations changed as well. Instead of negotiating deals in person, more business leaders were doing so over the phone or through video calls. The same is true in the real estate world. The pandemic led to an increased reliance on technology to help buyers and sellers continue to move forward with real estate transactions amid stay-at-home orders.
Although the pandemic is over, the technology remains. This technology continues to offer benefits but both parties are wise to use it with caution. As the real estate industry continues to adapt to the digital age, virtual home tours and remote closings are becoming increasingly common. However, these modern conveniences also bring new legal challenges. Misrepresentation lawsuits can arise if property flaws are not adequately disclosed during virtual tours. Additionally, remote closings must comply with state laws regarding electronic signatures and notarization to ensure transactions are enforceable.
Risks associated with virtual house tours
Virtual house tours offer convenience but can inadvertently lead to legal complications, particularly regarding property representation. Virtual tours might not capture all property defects, leading buyers to make decisions based on incomplete information. Sellers might face lawsuits if buyers discover undisclosed or misleading information about the property condition post-purchase.
Ensuring compliance during remote closings
Remote closings streamline the real estate transaction process but require strict adherence to legal standards to be valid. It is important to use electronic signatures in accordance with applicable laws. Without compliance, signatures may not be legally binding.
Some states also have specific requirements for electronic notarization, including the use of certain technologies or platforms.
Key considerations for virtual tours and remote closings
Buyers and sellers can still use these tools to the benefit of their transactions. To mitigate risks and help better ensure legal compliance, parties involved in virtual house tours and remote closings should consider the following:
- Ensure comprehensive virtual tours: Use high-quality, detailed videos and consider providing live virtual walkthroughs to address potential buyer questions in real-time.
- Disclose all property issues: Clearly document and communicate any known defects or issues with the property to prevent future legal claims.
While virtual house tours and remote closings offer significant advantages by making the real estate process more convenient and accessible, they also require careful consideration of legal aspects to avoid potential disputes. By adhering to best practices for disclosure during virtual tours and ensuring compliance with relevant laws during remote closings, sellers and real estate professionals can protect themselves from legal repercussions and better ensure smooth, transparent transactions.