What Does A Real Estate Lawyer Do?
A real estate lawyer carefully review contracts, conduct title searches, resolve any title issues that may arise, negotiate terms and provide legal guidance throughout the entire transaction process. Real estate lawyers also assist with handling zoning disputes, drafting property deeds, and addressing matters concerning rental properties. They ensure a smooth and legally compliant transaction while protecting the client’s interests.
What Is A Real Estate Lawyer?
A real estate lawyer is a legal expert in real estate law specializes in various aspects of real estate transactions, such as buying, selling, and leasing properties.
Qualifications to become a real estate lawyer
To become a real estate attorney, one must obtain a Juris Doctor (JD) degree, pass the state bar exam, and be knowledgeable in state and federal regulations governing real estate transactions. Many attorneys focus on a specific area of real estate law, gaining expertise through continuing education and experience.
Real estate lawyers must possess excellent communication and negotiation skills since their part of the job is collaborating with other professionals, such as real estate agents, mortgage lenders and opposing counsel.
The attorney’s role will differ based on which party they are representing.
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Who Does A Real Estate Attorney Represent?
A real estate attorney typically represents one of the parties in a real estate transaction, such as the buyer, seller, or mortgage lender. Their responsibilities differ depending on the party they represent.
What Does a Real Estate Attorney Do for a Buyer?
A real estate attorney for a buyer reviews title searches, prepares purchase contracts, reviews loan documents, identifies title issues, tailors contract forms to the buyer’s needs, negotiates with the seller’s attorney, represents the buyer at closing, and provides advice on zoning and land use regulations.
- Reviews the title search and/or commitment to ensure the seller has a clear and unencumbered title so that the buyer’s ownership is uncontested.
- Prepares a purchase contract outlining transaction terms and conditions.
- Reviews the note, mortgage and other loan documents to help the buyer understand their rights and obligations.
- Identifies any title issues or disputes and ensures that title is clear for the buyer.
- Amends standard contract forms to tailor them to the buyer’s needs.
- Negotiates with the seller’s attorney to ensure the best possible terms for the buyer.
- Represents the buyer at the real estate closing.
- Advises on zoning and land use regulations.
A real estate attorney for a seller reviews and drafts contracts, negotiates favorable terms, provides guidance on the sale process, conducts title searches, resolves title issues, handles disputes, drafts leases and deeds, and manages the closing process.
- Reviews and drafts real estate contracts, ensuring compliance and protection of the seller’s interests.
- Negotiates favorable contract terms for the seller.
- Provides guidance and advice on the sale process and contract details.
- Performs and/or reviews a title search to identify any issues to be resolved before closing.
- Resolves title issues, such as liens or ownership disputes.
- Drafts or reviews property deeds for accurate transfer of ownership.
- Handles transaction disputes and represents the seller’s interests.
- Drafts and reviews leases, assignments and covenants for landlord-sellers.
- Manages the closing process and issuance of title insurance policies.
What Does a Real Estate Lawyer Do for a Mortgage Lender?
A real estate lawyer for a mortgage lender drafts mortgage contracts, represents lenders in defaults or foreclosures, handles construction loans and related contracts, provides legal advice on unique situations, and acts as the closing attorney by preparing and presenting documents for signing.
What Are the Issues A Real Estate Attorney Can Help?
Purchasing or selling real estate can be a complicated process filled with legal complexities. While not required, hiring a real estate attorney can help simplify the situation and provide valuable guidance. There are several key ways an attorney can assist with a real estate transaction:
1. Property Taxes
Calculating and paying property taxes on a new home purchase can be confusing. Property tax rates, assessments, exemptions, and payment schedules vary between jurisdictions. An attorney helps buyers understand how property taxes are determined, ensures the proper amounts are paid, and takes advantage of any available exemptions or discounts.
2. Estate Planning
Proper estate planning is crucial to ensure your property is transferred according to your wishes if you become incapacitated or pass away. An attorney can draft important legal documents like wills, trusts, and powers of attorney to legally direct your assets to your chosen beneficiaries.
3. Zoning Regulations
Local zoning ordinances dictate how properties can be used. An attorney will research the zoning for your property and make sure any proposed use, renovations, or new structures comply. Violating zoning can lead to fines or being forced to change your property.
4. Property Deeds
Deeds legally transfer ownership of real estate. Real estate attorneys prepare and file the proper deeds to formally transfer property titles between buyers and sellers according to local regulations. Deed mistakes can cause major problems.
5. Title Search
Before purchase, a title search should be completed to verify the seller legally owns the property and identify any issues or claims that could cloud the title. An attorney performs the title search, resolves problems, and gets title insurance to protect against future title claims.
6. Additional Documents
Real estate transactions require various additional legal documents like leases, easements, covenants, and subleases. Experienced real estate lawyers properly draft, review, and negotiate these documents to protect your interests.
7. Land Disputes
Disagreements over property boundaries, easements, or ownership can become complicated legal disputes. Real estate attorneys help navigate these disputes, whether transaction-related or longstanding conflicts between neighbors.
8. Rental Properties
Owning rental real estate brings legal obligations under landlord-tenant laws. Attorneys can draft rental agreements, advise on rights and duties, and assist in resolving tenant disputes.
9. Making a Complex Situation Simpler
By handling the complex legal aspects, a knowledgeable real estate attorney simplifies the transaction process. Their expertise and guidance helps buyers and sellers avoid costly mistakes and ensures a smooth property transfer. Though not required, hiring an attorney is wise for many real estate transactions.
Hiring a real estate attorney may be necessary, depending on your state, lender and contract situations. Some states require legal representation for both buyers and sellers during closing, while others mandate attorney involvement in the title process. Certain lenders may also require a real estate attorney as a condition for obtaining a loan. If you encounter contractual issues during the purchase or sale of a property, an attorney can help clarify and resolve these concerns.
1. State Requirement
While certain states give you the option of whether or not to hire a real estate attorney, several of them require it.
Both the buyer and seller are legally mandated to have legal representation during closing In Connecticut, Delaware, Georgia, Massachusetts, North Carolina, Rhode Island, South Carolina and West Virginia.
A lawyer’s involvement is required to oversee the title process in Alabama, Louisiana, Mississippi, North Dakota, Oklahoma, South Dakota and Wyoming.
While not legally required, legal counsel is commonly involved in the closing process in Illinois (including Chicago), New Jersey, New York and Ohio.
2. Lender Requirement
Some mortgage lenders may stipulate that you hire a real estate attorney as a prerequisite for obtaining a loan, particularly in states where attorney involvement in the closing process is customary.
3. Contractual Issues With The Purchase
If you encounter any contractual issues during the purchase or sale of a property, a real estate attorney can help you understand and resolve these concerns. Issues might include disputes regarding contract terms, the protection afforded by a particular provision, or an unclear division of responsibilities among the parties.
When to Hire a Real Estate Attorney?
Hiring a real estate attorney is advisable in situations like buying or selling residential property, dealing with new construction projects, facing zoning disputes, encountering title defects, participating in a short sale or foreclosure purchase, engaging in commercial real estate transactions, or selling property as an heir. In these cases, legal expertise can be invaluable to navigate the complex processes and ensure your interests are protected.
If your sale or purchase entails unusual circumstances, such as a short sale, a complex zoning dispute, or a mixed-use building, it’s almost certain that you’ll require a lawyer.
When You Don’t Need to Hire a Real Estate Attorney?
You might not need to hire an attorney if you commonly transact real estate and the transaction is straightforward. However, it’s crucial to thoroughly assess the potential risks and benefits before deciding to proceed without legal representation.
What Are the Risks of Not Using Real Estate Attorneys?
While choosing not to hire an attorney might seem like a cost-saving measure, it’s crucial to consider the risks of not having legal representation during a real estate transaction.
Without an attorney, you may face the following risks:
1. Overlooking important legal issues
An attorney can help identify and address potential issues before they escalate. Without their expertise, you may overlook crucial details that could lead to future disputes or complications.
2. Misinterpreting complex legal documents
Property transactions involve numerous documents, and understanding their nuances, can be challenging for someone without legal training. A real estate attorney can help you decipher these documents and ensure that you fully comprehend their implications.
3. Failing to protect your interests during the transaction
Real estate attorneys work to protect their client’s best interests throughout the transaction process. Without one, you may not be aware of certain aspects of the transaction that could negatively impact you, such as unfavorable contract terms or hidden clauses.
4. Avoid legal disputes with guidance
Encountering disputes or complications that could have been prevented with legal guidance – A real estate attorney can help prevent disputes and complications by ensuring that all aspects of the transaction are legally sound.
For instance, a Chicago homebuyer who opts not to hire a real estate attorney may inadvertently overlook a title defect, leading to a costly and time-consuming legal dispute after closing.
Chicago real estate lawyers charge either an hourly rate or a flat fee. Hourly rates can range from $200 to $500 per hour, with more experienced attorneys charging higher rates. Flat fees are charged for specific services and can vary widely, with some discount lawyers charging as little as $250 for a real estate closing. A typical flat fee closing in Chicago ranges between $550 to $1000.
1. Hourly Rates
Hourly rates can range from $200 to $500 per hour, with more experienced attorneys charging higher rates. The total cost for hourly services will depend on how many hours the attorney spends on your case. It’s worth noting that some attorneys may require a retainer fee, an upfront payment covering a portion of the anticipated legal fees.
2. Flat Fee
On the other hand, flat fees are often charged for specific services, such as reviewing a purchase contract, conducting a title search, or handling the entire purchase or sale process. Flat fees can vary widely, with some discount lawyers charging as little as $250 for a real estate closing. A typical flat fee closing in Chicago ranges between $550 to $1000.
Adler & Herbach charges a flat fee of $750 per sale for both buyers and sellers. Thanks to our affiliation with the title company United Settlement Services, we’re able to offer 50% off seller-side title fees! Call (847) 318-3770 today, or contact us to learn more.
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To find a real estate attorney near you, ask for personal recommendations, consult local professionals, use online resources to search for lawyers with positive reviews, interview potential attorneys, verify their credentials and experience, and trust your instincts when selecting one who understands your needs.
Here are some steps to do that:
- Seek Personal Recommendations: Ask friends, family, and colleagues who have recently bought or sold property in Chicago for referrals to lawyers with whom they worked and were satisfied.
- Consult Local Real Estate Professionals: Real estate agents, mortgage brokers and title company representatives often work closely with real estate lawyers and can suggest a reputable attorney with a strong track record.
- Utilize Online Resources: Use resources like Avvo and the Illinois State Bar Association’s website to identify lawyers near you who specialize in real estate law. Look for attorneys with positive client reviews and testimonials.
- Interview Potential Attorneys: Arrange consultations with lawyers on your shortlist to discuss your needs. Ask about their experience, fees and availability. Use this opportunity to assess their communication skills and responsiveness.
- Verify Credentials and Experience: Confirm the lawyer’s credentials, including their law degree, state bar license and any relevant certifications or memberships.
- Trust Your Instincts: Choose a lawyer you feel comfortable working with and who understands your needs. Trust your instincts to select the attorney who can provide the best representation for your real estate transaction.
The Bottom Line
Hiring a real estate attorney can be invaluable in successfully completing your real estate transaction.
From ensuring a clear title to resolving disputes, a good real estate attorney can protect your interests and simplify a complex process.
While not always required, hiring a real estate attorney in Chicago, or any other location, can provide you with peace of mind and help you navigate the legal intricacies of buying or selling property.