So you’ve decided to take the big step of buying a home. It’s probably the biggest purchase and most expensive investment you’ll ever make. But it’s not a simple process. There are a lot of laws that are specific to real estate, with which most people aren’t acquainted. Just like hiring a real estate agent to deal with the sale, you may want to consider hiring a real estate lawyer to guide you through the legal process in the real estate industry.
Read on to learn more about what a real estate lawyers and real estate law, all the responsibilities that come with practicing real estate law, what their qualifications are, and when you should consider hiring one.
Real estate attorneys are professionals who specialize in and apply their legal skills to matters related to property, from everyday transactions to disputes between parties.
Although they are not required at every transaction, a homebuyer may benefit by hiring one to help make sure there are no hiccups through the process. Some states even require buyers to hire a real estate attorney, so it’s best to verify with your realtor if you need one. After all, it is an added expense that you have to cover. Most realtors who specialize in real estate law charge by the hour for their services, while others get paid a flat fee based on the transaction.
Keep in mind that having someone who is experienced with the law on your side may help you avoid any legal problems that can cause delays to your closing, and save you money in the long run.
Real estate law oversees the purchase and sale of real property—that is, of land and anything attached to it such as buildings or other structures. It also includes anything that comes with a property such as appliances or fixtures. This type of law has nothing to do with personal property or someone’s personal possessions, and only with real property.
This branch of the legal system, therefore, ensures the proper procedures surrounding the acquisition of property, as well as what people can do with that property. Real estate law also factors in things like deeds, property taxes, estate planning, zoning, and titles.
Real estate law varies by state, making it state law. So attorneys must be licensed to practice in their state and must be up to date on any of the changes that affect transactions that happen locally or in their state.
IMPORTANT: Real estate law varies by state, so it’s also considered state law.
A real estate attorney is equipped to prepare and review documents relating to real estate such as purchase agreements, mortgage documents, title documents, and transfer documents. Real estate attorneys also often handle closings—when an individual or entity purchases a piece of real property from someone else.
In most cases, the real estate attorney provides legal guidance for individuals relating to the purchase or sale of real property. He or she ensures the transfer is legal, binding, and in the best interest of his or her client.
During the purchase of a property, the real estate attorney and staff often prepare all closing documents, write title insurance policies, complete title searches on the property, and handle the transfer of funds for the purchase. The attorney, or his or her team, also prepares forms such as the HUD-1 Form and related transfer of funds documentation for the buyer’s lender if the purchase is being financed.
In the case of a real estate dispute, such as chain of title, lot line problems, or other issues involving contracts, an attorney works to resolve the problems. He may work for either side and provide legal representation for the parties in a courtroom setting. The real estate attorney obtains facts from both sides of the dispute and tries to come to a resolution that works for everyone involved. This may mean hiring a surveyor or title company to work through some of the details.
Becoming a real estate lawyer requires a lot of education and experience. An attorney must first earn an undergraduate degree, then pass the Law School Admissions Test (LSAT) before being considered for acceptance to a law school.
Prospective lawyers must earn a law degree, which typically takes three years if done full-time. During the first year, student learn the basics of the law profession. During the following years, they take electives like real estate law and do internships to gain practical experience.
Once a student completes law school, he or she must pass the bar exam in order to begin practicing. Some lawyers choose to study further, perhaps working toward the successful completion of a graduate degree, professional designation, or other certificates that cater specifically to real estate law.
As noted above, some states require the presence of a real estate attorney during any real estate transaction. If you live in Alabama, Connecticut, Delaware, D.C., Florida, Georgia, Kansas, Kentucky, Maine, Maryland, Massachusetts, Mississippi, New Hampshire, New Jersey, New York, North Dakota, Pennsylvania, Rhode Island, South Carolina, Vermont, Virginia, and West Virginia, you must hire a lawyer to oversee the deal. These states are generally called attorney states.
If you don’t live in any of these states, it’s up to you whether you want to hire an attorney. Although it’s an additional cost, it may be a good idea to hire a lawyer who specializes in real estate law. Their services can be invaluable, helping to navigate you through the murky process and resolving tough situations like a foreclosure or even a short sale. They are also helpful during the purchase of a commercial property. In short, don’t discount what a real estate lawyer can do for you, even it if means paying a little more.
Provided by Troy Segal from Investopedia.com