Craig Tashjian Learning Center -Beyond the Mortgage - Do I Need a Lawyer? Frequently Asked Questions

Mortgage FAQ's | Mortgage Shopping Tips | The Mortgage Process | Additional Considerations

Mortgage Education

Considerations Beyond the Mortgage

Do You Need a Real Estate Attorney?
Frequently Asked Questions

Presented by Daniel W. Ladd
The Law Office of Daniel Ladd, PC
7781-860-7600
www.laddlaw.com
danladd@laddlaw.com

I'm buying property. Why do I need an attorney?

The purchase of a home is probably the biggest expense of your life. Protect your investment by having an attorney available to watch out for your interests. When purchasing a home, the following are legal issues which need to be addressed:

Review Offer to be sure all essential details are covered properly.
Review Purchase and Sale Agreement form, including changes made to standard form by broker and seller's attorney.
Assist with negotiation of P & S terms, especially issues raised as a result of structural inspection of home.
Coordinate with brokers, seller's attorney and lender's attorney. Assure that all contingency deadlines are properly monitored.
Review impact of issues raised in title examination.
Review settlement figures, including financial adjustments with seller and closing costs with lender.
Attend closing to review and explain loan documents to buyer.
Coordinate and provide advice with related matters including homestead protections, insurance and estate planning implications.

In addition, if your purchase involves a condominium, a multi-family property or new construction, there are additional issues related to such properties which should be reviewed with your attorney.

I'm selling property. Why do I need an attorney?

When selling real estate, the following are legal issues which need to be addressed:

Review issues raised in Offer, prior to acceptance.
Draft Purchase & Sale Agreement and review changes proposed by Buyer's attorney.
Coordinate closing timetable and other issues with all other parties.
Resolve any title issues raised by Lender's attorney.
Prepare new Deed to Buyers.
Review closing costs and adjustments.
Attend closing to review and explain other documents which are presented to Seller for signing.

In some of these matters your attorney will work with your broker, and other matters really do require the expertise of an attorney. And for those selling without a broker, see the related question and answer below.

I'm buying property. How early in the process should I get an attorney?

Now! If you're even at the earliest stages of thinking about buying, you should line up an attorney who will be available when the process accelerates. Call a few attorneys. Ask questions. See who you feel comfortable with. Most real estate attorneys will not charge you for a brief telephone consultation.

At our office, we usually spend a half hour during an initial call discussing general background information if a client is unfamiliar with the entire process. We will discuss how to work with brokers and use of buyer-brokers, preapproval for mortgages and the different types of mortgage lenders available. And we will discuss what you should do if, one Sunday afternoon, you find yourself at an open house and suddenly decide that it would make the perfect home for you. Don't wait until that final urge to make an offer before starting to look for an attorney. A well informed and well represented buyer is more likely to have a successful home-buying experience.

What does a lawyer cost?

Attorneys handle real estate matters on either a flat fee basis or an hourly fee. In metro-west suburban communities the fees are generally quoted at around $200.00 per hour. It is difficult to say how many hours may be involved as each transaction can have many variables. I could stretch and say that an average sale of a single family residence might take three hours of your lawyer's time, and an average purchase of a single family residence might take three to five hours time. Therefore, if you ask your attorney to quote a fixed, flat fee, they will probably base it on a higher end estimate. Condos, multi-family properties and new construction will involve greater amounts of time than an existing single family.

With that said, you should discuss with your attorney the extent of legal services that you actually require. It may be that, especially for an experienced buyer or seller, you can get by safely with a reduced level of service.

I'm selling without use of a broker. What do I need to know?

For Sale By Owner ("fsbo's" or "fizzbo's") are increasingly popular with sellers who hope to save the cost of a broker's commission.

My first advice is, "It ain't as easy as you think". It is time consuming, often very inconvenient to be available for showings, difficult to make objective evaluations of offers, difficult to screen potential buyers, and involves more coordination of various matters than most sellers realize. Many such sales end up a price lower than a broker would have obtained. In addition, fsbos often take longer. It is not surprising that fsbo sales fall through once or twice before a seller finds a buyer who is committed and financially qualified and able to follow through to a closing. Those kinds of delays can be quite expensive to a seller.

With that caution, our office does, in fact, work with many sellers who are on their own. We will spend time discussing some of the legal issues regarding representations made to prospective buyers, how to evaluate a buyer, how to take an offer from someone, and the various other responsibilities of a seller which would normally be handled by a broker.

I'm thinking of buying a condominium. Is there anything special that I need to know?

While most issues in buying a condominium are similar to those in a single-family residence, there are some additional matters which are very important to review with your attorney. Some of these are:

What is the monthly condo fee, and what does it cover?
What are the condo rules and regulations? Can I have a pet, a home office, a flower garden?
Do I get any deeded parking or storage spaces?
Does it matter if most of the units are owner-occupied or owned by investors who rent them out?
Is the condo owners association financially sound?

A condominium can be appropriate as a first home or at many other stages of life. In order to assure that it is a successful living experience for you, be sure to review these matters with your attorney