In many states across the country, it is required to have an attorney's representation for real estate transactions. In others, it is optional; for some, it is not common at all. Unsure if you should hire an attorney to represent you in your real estate transaction, ask your real estate agent or mortgage lender. A real estate attorney has quite a few roles in a real estate transaction. With home values rising and homes selling at record speed, it is helpful to have an attorney on your side during the transaction.
Whether you are a home buyer or a home seller, once you sign a contract it is time to hire a real estate attorney. Most real estate contracts call for a specific amount of time, typically five to 10 business days, for attorney review. This means that both the buyer's and seller's attorneys will have that amount of time to look over the contract and propose any legal changes to the contract that they deem necessary.
Most contracts also call for an inspection period where the buyer has a certain amount of time to have professional inspections performed on the property. These inspections can include, but are not limited to a whole house inspection, a radon test, a lead-based paint inspection, a mold inspection, and a sewer inspection. This timeframe typically coincides with the attorney review period. It is advised that you forward the inspection reports to your attorney. Your attorney can ask for any remediations necessary based on any defects or safety hazards that are found in the home.
Communication with Key Parties to the Transaction
Your attorney will communicate with all parties of the transaction to help ensure it goes smoothly. They will work with your real estate agent, the other party's attorney and real estate agent, the lender, the survey company, the escrow company, the title company and the like. All correspondence is usually in the form or legal letters and emails. This is to make sure that everything is in writing and is documented.
Another role your attorney has is to be sure everything required of the real estate transaction is ordered and completed. Your attorney will work with a land survey company to be sure the survey is done. He will look over the survey to be sure there aren't any physical encumbrances on the property that will prevent or delay the transaction from closing.
Since home values are appreciating so quickly, there have been plenty occasions where homes didn't appraise for the purchase price. If there is a problem with the home appraisal, the real estate attorneys can help negotiate and sort that out as well.
Your attorney will also work with a title company to have a title search performed on the property to be sure a clean title is conveyed to the buyer. The buyer's mortgage company requires this. Title insurance will also be obtained for the seller and the buyer. Many attorneys are affiliated with title companies that are experienced and trustworthy.
Your real estate attorney will prepare all documents and paperwork necessary to close your transaction. If you need your attorney to sign any paperwork on your behalf, he will prepare a document call a "power of attorney" for you to sign ahead of time. Many sellers today do not attend closings. Their attorneys have them pre-sign documents, and they sign any last-minute documents using their power of attorney.
Your attorney will represent you at closing. He will review every document before you sign it. If you are purchasing a home and obtaining a mortgage, he will look through all the mortgage documents as well. Your attorney will order the deed and get it to you after closing.
If you have a choice, it is a good idea to have a real estate attorney represent you during your real estate transaction. He will help you from the day of contract through the day of closing. Your attorney will make sure you have copies of all the paperwork and documents from your closing. This includes your title insurance policy, your survey and your deed.