When making a life-changing financial decision, such as selling or purchasing a home, it’s usually a good idea to look for professional advice. Most buyers will visit with an inspector and pay for an appraisal in addition to hiring a real estate agent before purchasing or selling.
A real estate attorney is another specialist who could play a big part in the transaction.
In some places, real estate lawyers are required to be involved in the process, while in others, attorneys are used sparingly, if at all. From the buyer’s and seller’s perspectives, here’s why hiring a lawyer can be a good idea—or not.
A real estate lawyer is a lawyer who specializes in real estate transactions and is licensed to practice law. A real estate lawyer is knowledgeable about all aspects of the home-buying process and can represent buyers, sellers, or lenders.
Likely, a lawyer is just there to represent the buyer’s lender in locations where a lawyer is required to be present at closing. If you want someone just to express your interests, you’ll have to hire a lawyer yourself. Real estate attorney engagement rules differ from state to state and even within states like California, where regulations vary by county.
Some people hire an attorney early on in the process to handle things like examining the brokerage contract with a real estate agent. At the same time, others wait until the purchase contract is written or until the closing.
A lawyer’s charge could range from $200 to $300 per hour, or you could pay a flat fee of several hundred dollars at closing.
Why do you need a real estate lawyer before purchasing a home?
Although real estate brokers are frequently involved in the preparation of purchase contracts, a lawyer could check the terms of the agreement. Furthermore, real estate brokers are commonly forced to fill out contract templates rather than create arrangements from scratch. As a result, more complicated contracts may require the assistance of an attorney.
If you’re going to engage a lawyer at this point, it’s critical to allow a few days for legal review of the contract before it’s formalized, if at all possible. It can help you avoid problems in the future by making the contingencies as beneficial to you as possible.
A title search is another crucial task that attorneys perform. Its goal is to ensure that the property is free of encumbrances such as liens and judgments. The title search is necessary because it determines whether the seller has the legal authority to sell the property. Anyone can do a title search, but an attorney will be able to accomplish it faster and better. If they don’t undertake it directly, they’ll most likely have commercial relationships with companies specializing in title searches.
If the search turns up anything troubling, your lawyer can advise you on proceeding. Let’s say a title search reveals that the sellers must pay off a lien or a court judgment before selling their home. To compensate you for the delay, a lawyer may be able to negotiate a price reduction on the property. The lawyer may also provide the seller with financing alternatives or sources to help them satisfy their obligations.
Closing on a house sale or purchase, the moment you’ve been waiting for sometimes requires sifting through dozens of pages of legal paperwork. A lawyer can assist both the seller and the buyer navigate the review process, which can be frightening and challenging for a first-time homebuyer.
Transfers of Real Estate
Contract formulation and negotiations are complex when one or more parties are corporations, trusts, or partnerships. An attorney is familiar with the many types of business connections and their legal implications under your state’s laws. The attorney will confirm that the contract complies with the law and the charter provisions of the partnership, trust, or company.
Typically, real estate deeds must be submitted at county and state levels. An attorney will accomplish this in a timely and efficient manner. In other cases, the property may be located in an area where certain forms of construction are prohibited. If this occurs, an attorney will be able to guide you through the maze of state procedures so that you can complete the transaction.
Finding an attorney is much more important if the transaction involves commercial property. The attorney will be able to navigate government red tape to establish your corporation or sole proprietorship as a recognized business entity for tax reasons in your state. An attorney can assist you in obtaining a municipal business license.
If you are discriminated against during the home purchase process, lawyers can undoubtedly help. Even though most real estate attorneys do not specialize in that area, they will almost certainly know someone who does. However, don’t be fooled into believing that fighting discrimination requires a large sum of money or a high-priced legal team. Laws exist to safeguard everyone, regardless of their financial situation.