Real Estate FAQs | Real Estate Attorneys in Roseville, CA

Frequently Asked Questions About California Real Estate Law

California real estate law can be complex and is frequently misunderstood by buyers, sellers, landlords, and tenants alike. Below, NewPoint Law Group’s Roseville real estate attorneys answer the questions we hear most often.

Do I need an attorney for a California real estate transaction?

California does not legally require buyers or sellers to be represented by an attorney in a residential real estate transaction—most transactions are handled by real estate agents. However, attorney involvement is strongly advisable in complex transactions, commercial deals, properties with title issues, transactions involving trusts or estates, or any situation where disputes arise. An attorney can review contract terms, advise on legal rights, and help avoid costly mistakes.

What is the Real Estate Transfer Disclosure Statement (TDS)?

The TDS is a state-mandated disclosure form that sellers of most California residential properties must complete and deliver to buyers. It requires the seller to disclose known material defects and conditions that may affect the property’s value or the buyer’s decision to purchase. Sellers and their agents who fail to provide an accurate TDS may be liable for damages.

What does “time is of the essence” mean in a real estate contract?

This clause means that the performance deadlines in the contract are strictly binding. Missing a “time is of the essence” deadline—such as the contingency removal date or the close of escrow date—can give the other party the legal right to cancel the contract or declare a breach. California’s standard CAR purchase agreement contains multiple time-sensitive provisions that buyers and sellers must monitor carefully.

What happens to the buyer’s deposit if escrow does not close?

Whether a buyer forfeits their deposit when escrow fails to close depends on the reason for the failure and the contract language. If the buyer fails to close for a reason traceable to the buyer—and the buyer has removed contingencies—the seller may be entitled to retain the deposit as liquidated damages. If the seller is at fault, the buyer is generally entitled to a refund. These outcomes are fact-specific and should be evaluated by an attorney.

What is specific performance in a real estate dispute?

Specific performance is a court remedy that compels a party to complete a real estate transaction rather than simply paying money damages. Because real property is considered legally unique, courts can order a reluctant buyer or seller to go through with the sale. This remedy is not available in most types of contracts but is well established in California real estate law.

Can a buyer rescind a purchase after discovering hidden defects?

Possibly, depending on the nature of the defect, when it was discovered, and the facts surrounding the seller’s disclosure obligations. In some cases, buyers can rescind the contract and recover the purchase price. In other cases, the buyer’s remedy may be monetary damages rather than rescission. California’s statutes of limitations apply, so acting promptly is critical.

How does California’s mediation requirement work in real estate disputes?

Many California residential purchase agreements include a clause requiring the parties to attempt mediation before filing a lawsuit. Mediation is a voluntary, confidential process in which a neutral third party helps the parties reach a negotiated resolution. If a party refuses to mediate and the other party prevails in litigation, the refusing party may be denied attorney’s fees even if they would otherwise be entitled to them under the contract.