Everything Real Estate Lawyers Do, Explained

Buying a House, Homes

Buying and selling property isn’t something to be taken lightly. It’s a complicated process involving large sums of money, binding legal transactions and a lot of documentation – hence the need for real estate lawyers.

Real estate attorneys are certified professionals who are licensed to practice real estate law. While commonly referred to as real estate lawyers, an “attorney” actually refers to someone who has passed the bar exam and is licensed to practice law in their state. A “lawyer” is someone who has a law degree.[1]

Whichever term you prefer, remember that attorneys are licensed to practice law in a given state. We’ll go over their responsibilities and how these duties change based on who they’re representing.

What Do Real Estate Attorneys Do?

Real estate attorneys are heavily involved in the generation and review of legal documents related to property transactions. Depending on who they’re representing, part of their job is to make sure their client understands what they’re agreeing to.

Real estate attorneys can also be involved in the title search to ensure there are no liens or outstanding claims on the property. They also verify that the seller has the right to transfer ownership of the property to the buyer.

It’s common for real estate attorneys to be in charge of closing. They’ll ensure the contracts are signed and take care of filing the paperwork with the proper authorities.

Who Uses Real Estate Attorneys?

Anyone involved in a real estate transaction can hire a real estate attorney to look out for their best interests. This commonly includes buyers, sellers and mortgage lenders.

How attorneys help buyers

A lot goes into buying a house, and real estate attorneys can be a tremendous resource. Here are some ways real estate attorneys can look out for buyers:

  • Assist in the negotiation process
  • Help with the title search and securing title insurance
  • Ensure funds are transferred properly
  • Generate and explain documents
  • Review and explain homeowners association (HOA) covenants
  • Advise on property lines and encroachments
  • Talk you through any questions related to zoning
  • Ensure closing is binding and legal

Keep in mind that buying a home is one of the biggest purchases you’ll make. It’s often worth it to have a legal professional looking out for you and making sure everything is above board.

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How attorneys help sellers

Real estate attorneys can help sellers in many of the same ways they do for buyers.

  • Assist in negotiating transaction terms
  • Give general advice on the home sale
  • Resolve title issues
  • Draft and review documents

How attorneys help lenders

If financing is involved, it’s common for mortgage lenders to hire a real estate attorney. Here are some typical responsibilities attorneys handle:

  • Oversee the closing process
  • Assist with handling the down payment and earnest money
  • Review the purchase agreement to ensure the lender’s interests are protected
  • Research the title and help resolve any issues

While some of these duties overlap with what they do for buyers or sellers, an attorney’s focus changes based on who they’re representing.

When Do You Need a Real Estate Attorney?

Some states require a real estate attorney to be present at closing. In these cases, the attorney fees are included as part of your closing costs.

Here, the attorney’s focus is ensuring the legal documents are written properly and the agreement is legally binding. It isn’t the same as hiring a real estate attorney to specifically look out for your interests.

The following are instances when it can be a good idea to consult a real estate attorney:

  • First-time home buyer: As a first-time home buyer, everything in the process is new. It’s a good idea to have a licensed professional review the fine print in everything you sign with you in mind. That way, you don’t get taken advantage of.
  • Investment property: Whether you’re buying or selling an investment property, there are often complex tax issues that need to be considered. A real estate attorney can help you sort through them to ensure you have all the information you need to make a good decision.
  • Extensive negotiations: If there’s a lot of back and forth, or seller concessions, you want to make sure everything that was verbally agreed upon actually made it into the contract.

How Much Do Real Estate Attorneys Cost?

Costs will vary based on what services are provided and who’s responsible. For example, if your state requires an attorney to be present at closing, who pays those fees can be negotiated between the buyer and seller.

If you hire a real estate attorney specifically to represent your interests, you’ll either pay an hourly rate or a flat fee. Hourly rates are common for more involved services and generally cost $100 – $400 per hour.[2] Flat fees are common for a specific service, like reviewing a contract.

How Do You Find a Real Estate Attorney?

Your real estate agent should be able to make a recommendation. If you want a more personal connection, ask friends and family if they know anyone who might be a good fit for your needs.

If you aren’t having any luck with recommendations, you can check the American Bar Association’s directory. They’ll lead you to your state’s website, where you can connect with qualified local professionals.

What is the difference between a real estate agent and a lawyer?

Real estate agents are focused on finding buyers a home and getting the deal done – or getting the sellers the best price for a home if they’re the listing agent. Real estate attorneys are more focused on the specifics of the legal language, including purchase agreements and titles.

Do you need an attorney to buy a house?

Some states require an attorney to be present at closing. And unless you hire an attorney to represent you, their focus will be on the legality of the contract and ensuring everything is registered properly – not combing through the fine print to ensure you’re being treated fairly.

For this reason, it can be a good idea to hire a real estate attorney to represent you, especially if you’re a first-time home buyer.

How much is a real estate attorney for closing?

This will vary significantly depending on the state you live in and how complicated the transaction is. It’s common for these costs to range from a few hundred dollars to a few thousand.

Real Estate Lawyers Can Help You Look Out for Yourself

When dealing with purchases of hundreds of thousands of dollars, there’s a lot to be said for having peace of mind. These are complicated agreements, and everyone has their own angle, including the buyer, the seller and the lender. 

What’s good for them isn’t always what’s good for you, and there are no takebacks once the closing documents are signed. A good real estate attorney will help you get it right the first time.

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