When you enter into a real estate contract, you probably (hopefully) read the agreement in full. Like any contract, whatever is in the agreement, you will be bound to and have to follow, and whatever is not in the agreement, nobody can hold you to.

But while that may seem pretty straightforward, even obvious, that is not quite how it works when it comes to real estate contracts. When it comes to real estate, you can be bound by terms, conditions, and covenants that you neither agreed to nor signed.

Covenants That Run With Land

This is possible because of the existence of what are known as covenants that run with the land.

A covenant that runs with the land is a promise of agreement that binds every purchaser of the land. Think of the covenant as an agreement that “attaches” to the property. When you buy the property, you are also “buying” or agreeing to the agreements (covenants) that attach to that property.

Covenants that run with the land are covenants that generally affect the use or enjoyment of the land or the ability to do things with the land.

A traditional covenant is, for example, one that relates to a homeowners association. When you buy property, you do not get to negotiate the homeowners’ association rules, and you must abide by those rules, even if you never sign that you agree to them. Those rules attach to the land, and you are bound by them simply by virtue of having purchased the property.

The same goes for easements. If a power company has an easement to pass through your property to access power lines, that easement does not go away just because you never agreed to it. The easement attaches to and runs with the land, and by buying the property, you agree to it.

Publicly Recorded

This is not as scary as you think because, in almost every situation, a covenant that runs with the land must be recorded in public records. That means that your real estate attorney will know what covenants run with the land and what you will have to abide by when you become the new owner of the property.

In some cases, you can opt out of a purchase if it turns out that some covenant is too burdensome or onerous, and you do not want to comply with it.

Personal Agreements or Covenants

Do not confuse a covenant that runs with the land with a personal covenant. A personal covenant is just an agreement between Buyer and Seller; it relates to the obligations of the parties, not directly to the land.

So, for example, an agreement that the Seller will pay for repairs to the garage, although relating to the home, does not affect the use or enjoyment of the land and is just a personal covenant that cannot bind or pass to the benefit of any future owners of the property.

Real estate closings, and the documents and terms in them, can be complex. Do not make such a big purchase without help. Contact our New Jersey real estate and closing attorneys at The Law Office of Agnes Rybar LLC today.




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