7 Reasons You Should Hire a Real Estate Attorney
Deciding to use a real estate agent or a real estate attorney can be a difficult decision. People typically hire a real estate agent, but there are many instances when only a real estate attorney can help you or provide the services you need. Here are 7 instances when you should hire a real estate attorney.
1. No Hidden Agenda. Real estate attorneys have no financial interest in the transaction other than the agreed upon fee for their services. An attorney's fee is not dependent on the sale of the property or on the purchase price.
In conciliation court I recently observed a husband and wife being sued by the brokerage firm they had hired to represent them. The brokerage firm wanted to recoup the agent fee after the husband and wife had to cancel the purchase agreement due to a job loss.
2. Sale or Transfer Between Family Members. What do you do if you want to sell property to your son, daughter, or other relative? A real estate transaction can be relatively simple and often does not require as much documentation as a sale between strangers. Real estate attorneys can easily draft a purchase agreement or a contract for deed depending on the parties' needs.
3. Disclosure. Many problems that arise from real estate sales result from disclosure issues. The way items are described in the seller's disclosure can be the difference between a smooth sale and ending up in litigation. A real estate attorney can counsel you on what to put in the disclosure section of the purchase agreement and also on what to say so that you will not be liable, potentially saving you thousands of dollars in future legal fees.
4. Attorneys Can Modify The Agreement. Every real estate transaction and property is different. Don't use cookie cutter forms that cannot be changed. A real estate attorney will craft the purchase agreement to meet your needs, whether that be special contingencies, fixtures, or closing terms.
5. Liens. Typically, a property needs to be free from liens before closing. Most people will not purchase a property if there are problems with the title. There are always exceptions to this rule but liens cause serious issues. If a property has liens on the title, closing may be delayed and it may cost thousands of dollars to have the issue resolved.
Judgment liens against the seller can prevent closing and increase costs as well. It takes significant work to determine whether a judgment lien will attach to the property. A real estate attorney can look into these issues and help resolve them. It is important to be prepared and have someone that can advise you throughout the process.
6. Tenants. Purchasing a home or commercial property that is currently leased provides a special set of challenges. You may want to rent the property to someone else or you may want to use the property yourself. What do you do if their lease extends past the closing date? How do you negotiate an early termination of the lease or can you cancel the lease entirely?
A real estate attorney will interpret the lease and will be able to tell you what actions you are legally able to take. An attorney will also be able to represent you in an eviction action if the issue comes to that point. The attorney's representation can be seamless if they are involved from the start.
7. Land Use and Zoning Laws. It's your home or commercial property, right? You should be able to do what you want. That isn't always the case. City or county land use and zoning laws will apply. Sometimes there are also restrictive covenants within a development. These rules will govern how you are able to use your property.
Are you planning to run a business out of your home? Would you like to rent out the mother-in-law suite? A real estate attorney can tell you whether those uses are allowed in the current zoning or covenants. If not, a real estate attorney can guide you on what is allowed in the current zoning and the possibility of obtaining a variance.
A real estate attorney provides many services that will benefit you during a transaction. In addition, many will provide guidance that will help you far more than with your current transaction and will save you money in the long run. Before jumping in to a real estate transaction, take the time to evaluate your needs, what issues you will have along the way, and your future goals. Hire the professional who will meet all of your needs and make the process as easy as possible.