Buying a home is probably the biggest investment you will ever make. In addition to hiring a real estate agent to help negotiate a transaction, you might consider a real estate attorney to guide you through the legal process. Real estate attorneys specialize in property-related matters, from transactions to settlement of disputes between parties.
Real Estate Attorney: An Overview
Many states require a real estate attorney to show up when they close. Even if your state does not require it, you may want a real estate attorney to be there for you. A real estate attorney will represent your interests at the end. They will review all paperwork in advance and advise on any problems or omissions with the documentation.
Most real estate attorneys charge an hourly fee for services, although some charge a flat rate. Your attorney will let you know in advance. Typically, the range is $150 to $350 per hour, or flat rates are $500 to $1,500.
What Real Estate Law Covers
Real estate law covers the buying and selling of real property, that is, land and any structures on it. It also includes legal issues related to anything pertaining to property or structure, such as equipment and fixtures.
Real estate attorney ensures that appropriate procedures are followed in the purchase or sale of the property. They may also be interested in how a property is partitioned for use. Real estate law covers deeds, property tax, zoning, zoning and title to real property.
Real estate laws vary by state and local government. The attorney 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 sales contracts, mortgage documents, title documents and transfer documents.
A real estate attorney hired to process the transaction is always involved in closing the session with the buyer. Closing is when paying and transferring ownership. The attorney is there to make sure the assignment is legal, binding, and in the client’s best interest.
During the purchase of real property, real estate attorneys and employees can prepare documents, write title insurance policies, complete a search for title to the property, and process the transfer money to buy. If the purchase is being financed, the attorney is responsible for paperwork such as the federal Form HUD-1 and the associated remittance document to the buyer’s lender.
In the event of a real estate dispute, such as ownership, division lines or other contract related matters, the attorney will resolve the matter.
A real estate attorney can also provide legal representation to a buyer or seller when the dispute ends in the courtroom. Real estate attorneys collect data from both sides of the dispute and try to bring them to resolution. This could mean hiring a surveyor or company title to work through details.
Like any lawyer, a real estate attorney holds a law degree, which typically takes three years of study for a full-time student. They also passed a state exam administered by the state in which they practice. Real estate law training can begin with elective courses and internships while studying law, and can continue thereafter with a certificate 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.1
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.
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