Real estate attorney: What they do and if you need one

Whether you're buying a home, selling your property, or renting out your house, legal counsel may be valuable for different kinds of real estate transactions. Real estate attorneys are qualified and legally authorized to prepare and look over documents and contracts related to the sale or purchase of a home.

Whether you're a homeowner or real estate investor, working with a real estate attorney can come in handy with different real estate transactions, from buying a house to closing on a house.

What is a real estate attorney?

In a nutshell, a real estate attorney reviews paperwork related to buying or selling a home or managing a property. As a board-certified legal professional, they can review contracts, guide you through the closing process for short sales and regular sales, and offer their expertise on zoning, land use, and regulations.

Their roles during real estate transactions are many: They make sure you steer clear of costly mistakes, help with smoother processes, and overall ensure you have proper guidance.

What does a real estate attorney do?

As mentioned, a real estate lawyer can provide legal counsel for buying, selling, or renting a property. They can represent sellers, buyers, and investors. Here are some of the main services you can expect from a real estate attorney:

• Contract drafting and reviews
• Title searches
• Closing assistance
• Dispute resolutions

Types of real estate attorneys

There isn't one type of real estate attorney. The term "real estate attorney" is a broad category, with many types of various specialties:

• Residential: A residential real estate lawyer specializes in different legal aspects of buying, selling, or renting a home. This can include creating and reviewing contracts, conducting title searches, and closing on a home.
• Commercial: A commercial real estate attorney offers legal counsel and handles legal aspects of developing, leasing, selling, and buying commercial properties. They can play a role in resolving ongoing disputes and ensure compliance with building codes and zoning laws.
• Closing: A real estate attorney can serve as a closing agent, and can look over the purchase contracts for any issues. They can also ensure there are no conflicts of ownership or property disputes.
• Litigation: A real estate attorney who specializes in litigation usually handles evictions and drafts and executes notices.  They can also be involved with unlawful detainer lawsuit practices.
• Zoning and land use: A land use attorney specializes in anything that involves zoning and land use. This includes permits, boundary disputes, land-use laws, restrictive covenants, and assistance with the development process.
• Title, escrow, or deeds: A lawyer who specializes in escrow, title, or deeds can help you navigate issues that may arise with a title, such as liens and easements, and review and prepare deeds during a property transfer. They can serve as an escrow agent, and can help with making sure the funds are properly managed in a transaction and making sure everything is met contractually before the funds are dispersed.

Depending on your situation and the real estate transaction you're in the middle of, you'll want to seek attorneys with the proper specialization to get the best services and clearest guidance possible.

When do I need a real estate attorney?

Some states require a real estate attorney for different transactions. However, even if a real estate attorney isn't required, you might want to work with one when buying or selling a home, or renting one out. 

If you're a first-time home buyer, a legal professional can help you wade through the intricacies of the transaction and make sure you understand closing costs. 

If you're a real estate investor and renting out your property, an attorney can assist with drafting rental contracts and helping you get your head around shifting landlord-tenant laws. They can also help understand fair housing laws.

When selling a home, legal counsel can help you look over and draft contracts, make sure you're legally compliant, and resolve issues –think liens, encumbrances, and other title issues.

State or lender requirement

Every state has slightly different laws regarding real estate transactions, and some consider certain actions part of the process to be “practicing law.” These regulations are often meant to prevent real estate agents from acting in a legal capacity that they aren’t trained or licensed for.

For example, in many areas only a licensed attorney can put together legal documents related to the sale of a home, because they consider that to be within the realm of the practice of law. (However, in some areas, real estate agents now use standardized form contracts for home purchases that non-lawyers can legally fill out on their own.)

Certain states may also consider performing a home closing to be a practice of law, and as such, an attorney may be required to be present during closing. If you’re getting a mortgage with Rocket Mortgage, we require you to have an attorney conduct your closing if the subject property is located in any of the following states:

• Connecticut
• Delaware
• Georgia
• Massachusetts
• New York
• North Carolina
• South Carolina
• West Virginia

In some states, attorneys are required in some parts of the state and not others:

• Alabama
• Arkansas
• Illinois
• Iowa
• Kansas
• Louisiana
• Maine
• Mississippi
• Nebraska
• New Hampshire
• New Jersey
• Ohio
• Oklahoma
• Rhode Island
• Tennessee
• Vermont
• Virginia

Your lender should be able to give you guidelines on regulations in your area.

Contractual issues with a purchase

There are a host of contractual issues that could arise during the purchase of a home. For example, while reviewing the title, you might discover a lien or encumbrance on a property. Or you might find that the seller failed to disclose defects on the property.

Peace of mind

Real estate transactions can be stressful. A real estate attorney can give a person peace of mind. You'll want to assess your situation closely and determine if working with a legal professional can offer you greater calm.

For example, they can help you with different legal aspects during the home buying process – like reviewing the house title and helping you understand your property rights.

How much does a real estate attorney cost?

How much you’ll spend paying your real estate attorney (or attorneys) will depend on what services they’ve provided for you and who is responsible for that particular closing cost. If your mortgage lender requires an attorney to be present at closing, whether the buyer or seller covers the cost of the closing attorney will depend on how your real estate contract has been negotiated.

If you want your own attorney in addition to the one required by your lender, you’ll pay for any services they provide. Real estate attorney charges will vary, but following are some basic ranges to keep in mind.

• Fixed hourly rate: A real estate attorney who charges an hourly rate may charge $150 – $350 per hour, but this can vary a lot depending on how experienced the attorney is and what area you’re in.
• Fixed rates for specific services: They may also charge a flat fee for the particular services they provide. For example, a real estate attorney might charge $500 – $1,500 to conduct a home closing. Their fees may also depend on the sale price of the property in question.

How can I find a real estate attorney near me?

Since buying a home is such a large, important purchase, you want to make sure that the professionals you work with know what they’re talking about and are good at what they do. If you aren’t sure where to look to find a reputable real estate attorney, here are some places to start:

• Ask for recommendations from friends and family. If someone in your social circle recently purchased or sold a home and had an attorney, you might consider asking them who they used and what their experience was like.
• Utilize your state’s bar association directory. Your state bar association’s website can help you locate lawyers in your area who practice real estate law. Use the American Bar Association’s directory to help you find your state’s website.
• Use an online legal review site. There are many online review websites that will give you information on attorneys in your area, including their specialties, fee structures and any reviews left by former clients.

FAQ about real estate attorneys

Here are some frequently asked questions on real estate attorneys and what they do:

Who does a real estate attorney represent?

A real estate attorney can represent buyers, sellers, real estate investors, lenders, and title companies. However, they cannot represent the both parties involved in the same transaction. For example, the seller and buyer in the sale of a home.

Who pays for the real estate attorney?

The person or party the real estate attorney represents pays for the real estate attorney. For example, the seller of a home will pay for their legal representation, and the buyer of a home will pay for their attorney.

Do I need a real estate agent if I have a real estate attorney?

A real estate agent and a real estate attorney perform different roles. Your needs determine whether you need both or one or the other. A real estate agent helps facilitate real estate transactions for folks to buy and sell property by putting together listings and showings, and negotiating offers. They also handle different aspects of the paperwork and can guide you through the process. A real estate attorney, on the other hand, provides legal counsel for real estate transactions.

What’s the difference between a real estate attorney and a title company?

A title company is a third party that works on behalf of both the seller and the buyer to research and insure the title of a home. A title company can also help manage the closing process. The real estate attorney, on the other hand, is licensed to provide legal advice on real estate transactions, which can include the buying, selling, or renting of a house.

Do you need a real estate attorney in all states?

Some states, such as Connecticut, Georgia, and Massachusetts, require a real estate attorney during closing. Even if it's not required in the state you're buying, selling, or renting in, having a real estate attorney involved in the process can help make for smoother transactions and avoid costly mistakes.

The bottom line: Real estate attorneys can protect you and your assets

Working with a real estate attorney can safeguard you and your valuable assets. Having a seasoned, well-versed lawyer who can review, draft, and execute contracts and spot and resolve potential issues can save you from headache, hassle, and expensive blunders.

If you're ready to finance your next real estate project, you can apply for preapproval with Rocket Mortgage.

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