6-23-06
The Real Estate Attorney
The last two installments of this series dealt with negotiating your real estate sales contract. Once you and the seller have come to an agreement and have a fully executed (i.e., all parties have signed it) sales contract, the next step is to bring in your real estate attorney.
But do you really even need an attorney? What services will they provide for you? How much will these services cost? These are all great questions, and to make sure I get the answers right, I’ve asked real estate attorney Katharine Barr Tyler to lend her wisdom to this article. Katharine is extremely personable, very affordable, and has more than 25 years of real estate transactional experience in Chicago.
Do you really need a real estate attorney?
In the state of Illinois, technically you do not. However, practically speaking, the answer is a resounding yes! Especially as a first-time homebuyer, you do not want to embark on the most important financial investment of your life (to this point) alone. You will encounter a deluge of documents and disclosures and legal gibberish. For a nominal fee (see below), your real estate attorney will ensure that your interests are protected through the home buying process.
What if I’m not working with a real estate agent?
All the more reason to hire a real estate attorney. Some homebuyers choose not to use a realtor and deal with the seller directly. Just because you and the seller shook hands and are getting along great does not mean you don’t need a real estate attorney there to represent you throughout the process. Katharine agrees. “In this case, your real estate attorney is the necessary person who drafts your contract, so you can make an offer on the property on your terms.” Protect yourself and your investment!
What if I’m refinancing?
Ok, if you’re refinancing, you do not need a real estate attorney, as the title to the property is not changing hands. Just make sure you’re working with a loan originator you trust and keep your eyes peeled for unnecessary fees.
My uncle’s cousin is an attorney…
Can any attorney handle your pending purchase? Perhaps, but the best advice is to be sure to work with an attorney who specializes in real estate. Katharine adds, “If you’re going to hire an attorney why not hire one who handles real estate every day, is familiar with the contracts, mortgage documents and knows the typical timelines for the entire process.”
It is also recommended that you avoid working with an attorney who is going to be “doing you a favor.” It might save you a few hundred dollars in the short term, but again, we are talking about a property worth hundreds of thousands of dollars here. The home buying process is filled with industry-specific documents that need to be digested, and important deadlines that must be met. You need an attorney that will make your purchase a priority.
What will your real estate attorney do for you?
According to Katharine, “We provide comprehensive consultation and representation from the first telephone call from the client when the offer is made through the closing.” Plain and simple, your real estate attorney will ensure that your interests are protected through the home buying process. He or she will review and negotiate the specific terms of the contract, be sure you understand the terms of your loan and evaluate all documents, such as the deed, title policy, mortgage, survey, closing statement and seller disclosure statement. He or she will also attend the closing, make sure you receive clear title, inform you of any facts that affect your interest and provide counsel if difficulties arise.
Your attorney can handle all communications with the other party, including phone calls. This service reduces your exposure to the risks and unpleasantness of dealing with the other party on your own. Likewise, should a dispute arise, a simple letter from your lawyer on law firm letterhead may be all you need to resolve it.
How much will these services cost?
The eternal question: So how much? The best news about working with a real estate attorney is that he or she is surprisingly inexpensive. Believe it or not, fees range from only $350-$650; for the record, Katharine is definitely on the low end of this spectrum. The better news about working with a real estate attorney is you are only paying a one-time fee. This payment is not a retainer or money “to get the process started.” This fee is it, no matter how many phone calls your attorney needs to make or how many documents he or she needs to read.
In Conclusion
Your real estate attorney can protect you from costly mistakes, errors in the documents, errors in the figures, and problems that could lead to litigation or other costly legal action. The nominal closing fee for an attorney is far less than the potential damage from undetected clerical errors or the enormous fees for post-closing legal action that many people without a competent attorney are forced to incur. Katharine adds, “Your attorney is the person working directly and solely for you. He or she reviews the contract, deals with any inspection issues, tracks your loan process, protects your earnest money deposit, and attends the closing with you, making sure you are getting clear title to the property.”
Talk to you next month!
Mike McNamara has been an actor in Chicago for the past eight years in theatre, commercials, television and film. Mike is also a Mortgage Consultant and Loan Originator with West America Mortgage Company. He can be reached anytime at 773/398-0021 or McNamara310@aol.com. Special thanks to real estate attorney Katharine Barr Tyler, who can be reached at 312/663-1311 or KBTylerLaw@aol.com.