Buying a home is probably the biggest investment you'll ever make. In addition to hiring a real estate agent to help negotiate the transaction, you might consider a real estate lawyer to guide you through the legal process. Real estate attorneys specialize in matters related to property, from transactions to handling disputes between parties.
Real Estate Lawyers: An Overview
Many states require a real estate attorney be present at closing. Even if your state does not require one, you might want a real estate attorney to be there for you. A real estate attorney will represent your interests at closing. They will review all paperwork in advance and advise on any problems or omissions with the documentation.
Most real estate lawyers charge an hourly fee for services, although some charge a flat rate. The lawyer will tell you up front. Typically, the range is $150 to $350 per hour, or a flat fee of $500 to $1,500.
- A real estate attorney prepares or reviews all of the documents that are signed at the closing of a real estate purchase.
- The attorney is then present at the closing to represent the buyer's (or the seller's) interests.
- Real estate law is a matter for state and local jurisdictions.
What Real Estate Law Covers
Real estate law encompasses the purchase and sale of real property, meaning land and any structures on it. It also covers legal issues related to anything attached to the property or structures, such as appliances and fixtures.
Number of states that require attorneys to supervise real estate transactions.
Lawyers who specialize in real estate ensure that proper procedures are followed during the acquisition or sale of property. They also may be concerned with how a property is zoned for usage. Real estate law covers deeds, property taxes, estate planning, zoning and titles.
Real estate laws vary by state and local government. Attorneys must be licensed to practice in the state where the transaction is taking place, and must stay abreast of any state or local developments that could impact a transaction.
The Attorney's Responsibilities
A real estate attorney is equipped to prepare and review documents relating to purchase agreements, mortgage documents, title documents and transfer documents.
A real estate attorney hired to handle a transaction will always attend the closing with the buyer. Closing is when the money is paid and the title is transferred. The attorney is there to ensure the transfer is legal, binding, and in the best interests of the client.
During the purchase of a property, the real estate attorney and staff might prepare documents, write title insurance policies, complete title searches on the property, and handle the transfer of funds for the purchase. If the purchase is being financed, the attorney is responsible for paperwork such as the federal HUD-1 Form and related transfer of funds documentation for the buyer's lender.
In the case of a real estate dispute, such as chain of title, lot line problems, or other issues involving contracts, the attorney will resolve the problem.
A real estate attorney may also provide legal representation for either a buyer or a seller when a dispute winds up in a courtroom. The real estate attorney obtains facts from both sides of the dispute and tries to bring them to a resolution. This may mean hiring a surveyor or title company to work through the details.
Like any lawyer, a real estate lawyer has earned a law degree, which typically takes three years of study for a full-time student. They have also passed the state bar exam administered by the state in which they practice. Training for real estate law may begin with elective courses and internships during law school, and may continue afterward with a certification in real estate law.
When You Need a Real Estate Attorney
As noted, some states require a real estate attorney to supervise real estate transactions and be present at closing. These "attorney closing states" are Connecticut, Delaware, Georgia, Massachusetts, North Carolina, Rhode Island, South Carolina and West Virginia. Other states are considered "attorney title opinion states," meaning a lawyer is required to certify title. These states are Alabama, Louisiana, Mississippi, North Dakota, Oklahoma, South Dakota and Wyoming. Four states—Illinois, New Jersey, New York and Ohio—do not require real estate lawyers, however they are typically involved in transactions according to local custom and practice.
If you don't live in one of these states, it's up to you whether you want to hire an attorney. It may depend on your confidence in your own knowledge of the ins and outs of real estate law. Hiring one is certainly worth considering if you're trying to navigate a particularly murky or complex situation like a foreclosure or a short sale.