Why do you need an attorney for real estate transactions?
Compared to the amount of the property you are buying or selling, the cost of a real estate attorney is miniscule. Most attorneys charge a flat fee for services, which include document preparation, negotiations, mortgage documentation review, and attendance at closing.
If you have had a successful real estate transaction and had an attorney represent you, you know the difference in services of what a realtor and an attorney can provide.
Real estate brokers and lenders get paid when a transaction closes. They could be working with you for months without getting a paycheck. If you have an issue that seems important to you, they may try to move along the transaction and expect you to settle.
In a typical real estate transaction, things usually go smoothly and you close the transaction without major issues. Here are some cases where things did not go smoothly. A real estate attorney tries to solve the issue to their client’s advantage.
- The buyer for your property loses their job and wants to cancel the transaction. However, you are already committed to purchase another home. An attorney may negotiate additional time to find a new buyer so you are not stuck paying two mortgages.
- You are at the closing and you are told different mortgage terms than what you expected. An attorney will get the lender on the phone, or speak to some in the closing department, and rectify the matter.
- At the walkthrough of the property you are purchasing you notice the home is filled with items such as old mattresses, appliances that you were not expecting, and major debris in the backyard such as tree limbs. A lawyer will demand money be held in escrow until the items are removed. If the items are not removed within the time set forth by your attorney, then you use the money held in escrow for the removal.
- You installed a new furnace and water heater yourself without permits. Your buyer is asking for the permits and a certificate from the town that the work was inspected. Your attorney will instruct you on the proper way to obtain the permits.
- You are relocating to a new state and only know your realtor and attorney. You are looking on the internet at recent sales in the neighborhood and think you are overpaying for the home. Your attorney will request comparables from the realtor and review them along with the bank appraisal.
- You signed a commission agreement with a realtor who has done nothing to market your home – no open houses, no advertising, no follow-ups with realtors that have shown the property. You signed a six month contract and want out of your listing agreement. Your attorney can appeal to the broker on your behalf and ask for a release of your listing without your having to pay a brokerage commission.
- You notice white spots after a recent storm in the garage of the home you are buying. You note your concern to your realtor and home inspector but nothing comes of it. You suspect mold. After speaking with the seller, they tell you they had the spots when they moved in and just painted over them. Your attorney should look at the Seller's Property Disclosure to see if the mold was disclosed and negotiate a credit for mold remediation.
These "what if" scenarios demonstrate the validity of retaining a real estate attorney to protect your interests. By working with an experienced and knowledgeable real estate attorney, you can save time, frustration, and costly repairs.