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Although using the services of an attorney can easily add several thousand dollars to the cost of a real estate transaction, it's often money well spent. Read on to find out how an attorney will help you close the deal, and the pitfalls that may end up costing a lot of money.
Contracts
While most individuals have the ability to negotiate face-to-face with another party, the terms of the deal must be properly memorialized in a contract in order for them to be legally binding. Attorneys can do that by not only negotiating on your behalf, but also making sure that the contract adheres to all state laws as well as addresses any specific issues that might affect the future use of the property.For example, in New Jersey, the law stipulates that the buyer and the seller have three days to review a real estate contract signed in conjunction with a realtor before it becomes legally binding. Some home buyers/sellers aren't aware of this. A lawyer will not only make the client aware of it, the attorney will also review the contract for any legal glitches, make any necessary changes to it, and insert any contingencies that you might have. (For tips on finding a real estate agent, read Finding A Listing Agent.)
Addressing Liens
Another vital service that attorneys perform is called a title search. Title searches are completed by or through attorneys, and their purpose is to make sure that the property being sold is free of any encumbrances, such as liens or judgments. The outcome of the title search is extremely important because it reveals whether the seller has the legal right to sell the property in question. An attorney will be able to provide this service much faster, and often with less cost because real estate attorneys have working relationships with title search companies.
Suppose a title search reveals that the seller must first pay a lien or outstanding court judgment before his or her home can legally be sold. A lawyer will address this issue by suggesting that the seller sweeten the deal (for making the buyer wait) by granting a price reduction. The lawyer may also provide the seller with suggestions or sources for financing so that the seller can satisfy those claims. Attorneys will also be able to secure proofs that those judgments and/or liens have been satisfied. This is important if you as the new owner ever plan to obtain a mortgage or loan against the property value. (For related reading, see The Best Way To Borrow.)Property Transfers
When one or more parties are corporations, trusts or partnerships, the contract preparation and the ensuing negotiations are complex. An attorney understands these different types of business arrangements and their legal boundaries within your state's law. As such, the attorney will ensure that the contract is consistent with the law, but also that the terms of the deal in no way violate the partnership's, trust's or corporation's charter agreements.
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