When You Need a Real Estate Attorney

Do you need a real estate attorney to help complete your home purchase? Is it worth the expense? How does hiring a real estate attorney help you? What could happen if you go without a real estate attorney?

There are all kinds of lawyers out there. There are even several kinds of real estate attorneys. Subcategories of real estate law include:

• Residential
• Commercial
• Industrial
• Agricultural
• Landlord-Tenant
• Construction Law
• Environmental Law

Real estate lawyers fall into two main categories: litigators and transactional lawyers. Litigators primarily handle lawsuits and work in courts, while transactional lawyers handle contract matters and deal with government bureaucracies and usually work in other non-court arenas. Some real estate attorneys do both.

Expertise in one area of real estate law does not necessarily guarantee expertise in other areas of real estate law, and lawyering has become more and more specialized. If you are buying a new home, you will want to find a real estate attorney who specializes in residential real estate.

Why Hire a Real Estate Attorney?

If you are a first-time home buyer or you are buying or selling a home without a real estate agent (including buying a home in a for-sale-by-owner transaction), a real estate attorney can answer questions, investigate legal issues, assist in sales negotiations and attend to all the details (some of which you may not even be aware of).

Depending on the complexity of your real estate transaction, you may not need a real estate attorney. Many large real estate agencies have an attorney on staff who can review everything, sometimes for little or no additional charge. Ask your agent about this before you sign on with the agency.

A real estate attorney can protect you from problems that could arise during and after the sale, especially problems related to title issues and nondisclosures by unscrupulous sellers.

Many real estate attorneys will be willing to handle multiple tasks related to your home purchase for a set fee or retainer. Make sure the real estate attoney you choose has experience in the areas you need. Some real estate attorneys are also licensed real estate agents or brokers, but be careful, because not all real estate attorneys have these industry-specific licenses. And of course, few real estate agents and brokers are practicing attorneys.

Finding a Real Estate Attorney

Ask around: Talk to relatives, friends, neighbors, co-workers and consult your state and/or local bar association for referrals of real estate attorneys. Ask local real estate brokers and real estate agents for names of quality real estate attorneys they have worked with. Contact the local Realtors association for referrals. Consult the Yellow Pages and the Internet.

Prepare a list of questions: Compose a list of questions to ask the real estate attorneys you will interview. Most lawyers will answer basic questions for free over the phone, but their time is usually very limited, so the better your list of questions, the better you’ll be able to narrow your list and pick the best real estate attorney for you.

Make a short list and contact them: Identify a handful of possible real estate attorneys and contact them. Be specific, that is, ask questions that pertain to your particular situation. Ask for references. Ask each lawyer if they work on retainer, charge a flat fee or charge by the hour. If they charge by the hour, ask how much they charge per hour and how many hours they estimate it will take for them to do the necessary work for you, including reviewing contracts, handling disclosures and assisting with the title search and closing. (See below for a more complete list of the types of questions to ask.)

Select an attorney if needed: You should learn about the legalities of buying a home if you perform the tasks above, and performing them will probably help you determine whether you need to actually hire a real estate attorney. Remember, there is no requirement that you engage an attorney. But depending on your situation, it may be best for your peace of mind if you do.

Cautions: Get details. Ask lots of questions, such as: How many cases like mine have you handled in the past year and what problems occurred? Go with experience. Remember that lawyering is highly specialized and attorneys who represent landlords, builders or banks may not have experience representing consumers on residential real estate issues. Vet your candidates, that is, check them out on the Internet and ask around about their reputations. Be wary of conflicts of interest.

Meeting With a Real Estate Attorney

You have assessed your candidates and whittled your list down to two or three real estate attorneys that you want to meet. (You even may have narrowed it down to one candidate, but you want to be sure before you reach for your checkbook.) You have already spoken to them on the phone and asked pertinent questions. You want to choose the right one and there’s nothing like a face-to-face meeting for that.

Now what?

It’s a business meeting: You are meeting with a lawyer, so you should treat the meeting like a business meeting. Dress appropriately and be on time. Be polite. Show a degree of confidence and self-assuredness. You should try to impress the attorney and he should definitely be trying to impress you.

Be engaging and forthcoming: Give the lawyer a chance to get to know you. Keep your story short and relate it back to your reasons for be in the real estate market now and why you are sitting there talking to him. Gauge his level of interest. This is a chance for each of you to evaluate each other before you strike a business agreement.

Listen: Resist to the urge to explain everything initially. Let the attorney talk. Listen. A smart, experienced real estate attorney has probably performed services similar to what you need.

Be prepared: Lawyers are big on documentation. If you project a professionalism by having all the relevant documents and other paperwork complete and accessible, you will impress the attorney and he will be more willing to work with you. You may even save yourself some money.

Be honest: When dealing with any attorney, full disclosure is always best. It’s always better if you tell everything, even any detrimental information, than have your attorney be surprised later. Even if you do not hire the attorney, any conversations you have are covered under attorney-client privilege. Of course, if you are merely seeking an attorney to assist in the transaction, this won’t be an issue.

Don’t cling to preconceived notions: Let the attorney decide what issues are and are not in your favor. You may be in a sweat over nothing. The reason you are consulting with an attorney is that you want professional, educated advice and advocacy. The attorney may present several options as to what you can do and you should discuss the possible consequences of each of them. Keep you overall goals in mind.

Voice any opposition: You have to pick each other. Either you or the attorney can decline to enter into a contract. If you have any opposition, mention it. Ask if the attorney is comfortable representing you and confident of a positive outcome. (He should say, “Yes.”) Ask if he will be working on your case exclusively or if others at his firm will be assisting. Make sure you are comfortable with his answer and ask to meet his associates if you think it is necessary.

Know the costs: If all is going well so far, you should ask the attorney for his rates and fees, if you have not already gathered this information.

Don’t sign anything yet: If you are not completely comfortable or you have another real estate attorney or two on your short list yet to visit, do not enter into a contract. Tell the attorney you want to think everything over and you will call soon.

Know what you are signing: Once you are comfortable that an attorney is the right one to represent you, have the lawyer explain his contract, which should specify what he should provide and at what rate(s). Don’t sign until you fully understand everything.

Be ready to pay: Once you sign a contract, you’ll probably need to write him a check or produce a credit card for your attorney’s retainer, or initial payment, right then. Get a payment schedule for future payments.

Be clear about what’s next: When will your new real estate attorney begin working on your case? When does he expect results? What can you do to help? Take notes and follow up. Be clear about how you will remain in contact — insist on regular communications even if nothing is new — with your new real estate attorney and be prompt in future communications.

In our last post, we discussed homeowners insurance. In our next post, we’ll discuss securing final loan approval.

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