Real Estate Attorneys: What Do They Do, And Do You Need One?

The legal and technical hoops you need to jump through when buying and selling real estate can seem daunting. In most cases, your mortgage lender and real estate agent are certainly capable of guiding you through the home purchase process.

However, sometimes you may require the services of a real estate attorney, depending on the nature of your transaction and the laws in the state where you’re buying or selling property. Let’s take a deeper dive into what a real estate attorney is, what they do and why you may consider utilizing their services.

A real estate attorney – also referred to as a real estate lawyer – is specifically licensed to practice real estate law. This means they have the knowledge, experience and educational background to provide advice to people involved in a real estate transaction, such as the sale of a house or land.

Real estate attorneys prepare and review documents and contracts related to the sale and purchase of real estate. Both the buyer and seller can hire a real estate lawyer to represent their interests during the transaction.

In some cases, a real estate attorney might be in charge of the closing of the home. When they’re overseeing a closing where the home is being purchased with a mortgage loan, the real estate attorney may represent the mortgage lender as well.

Whether representing the buyer, the lender or the seller, a good real estate lawyer has a solid understanding of the various moving parts during a real estate transaction and should be able to make sure everything runs smoothly.

While it’s not always necessary to hire a real estate attorney when buying a home, they can be a valuable resource to help guide you and represent you through the home buying process. Where you live may also determine whether a real estate lawyer will be required for certain parts of the transaction.

Here are a few scenarios where you might need a real estate attorney:

• You live in a state or locale that requires a real estate lawyer. States have slightly varying regulations on what steps of a real estate transaction are considered a “practice of law.” Some states require a lawyer – instead of a real estate agent or REALTOR^® – to compile all the legal documentation of a real estate transaction.
• You’re new to or don’t understand the home buying process. Perhaps you’re a first-time home buyer who’s unfamiliar with legal documents and contracts pertaining to real estate. Or maybe you’re a current homeowner who feels overwhelmed at the prospect of selling your home. Either way, a real estate attorney can be extremely valuable when helping you navigate your home buying – or selling – journey.
• You’re involved in a real estate purchase that’s a little out of the ordinary. For instance, you may be purchasing a short sale or as-is home, you may need a power of attorney to sell a vacation home, or your new house may be involved in property line A good real estate attorney can help you navigate some of these trickier transactions.
• You just want peace of mind. You’ll need to digest quite a bit of paperwork and information – like title insurance and rent-back agreements – and deal with sellers and contract contingencies. Even if it isn’t your first home purchase, working with a licensed real estate attorney can bring some peace of mind throughout the entire process.

The cost of a real estate attorney depends on what services you hire them for, the mortgage lender you choose and any laws that are specific to your state. Some real estate attorneys have a fixed hourly rate, and others have fixed flat rates for different types of services they offer. See below for a sample of ranges: 

• Fixed hourly rate: A typical hourly rate can be $150 – $350.
• Flat fee: A flat rate that covers the entire transaction can be anywhere from $500 to $1,500.

Purchasing a home is a large investment, so you’ll want to hire a real estate attorney who not only knows what they’re doing but is also a good fit for your specific needs and style. It’s a good idea to interview a few different ones who work in your local housing market to ensure you find the right real estate agent near you.

Here are a few questions to consider when interviewing real estate attorneys:

• Are they knowledgeable?
• Do they have a good reputation?
• Are they personable and do they possess great communication skills?
• Are they recommended by co-workers, friends or family?
• Do they have good reviews on online legal review sites?

What does a real estate attorney do for the buyer?

Buyers – and sellers – typically hire a real estate attorney when they don’t understand the home buying and mortgage processes, or when state laws require a lawyer to conduct certain actions of the real estate transaction.

In turn, a real estate attorney will prepare – and review – all loan documents for the buyer, negotiate the terms of sale on behalf of the seller, attend the mortgage closing and provide legal advice throughout the home buying or selling process.

What states require you to hire a real estate attorney?

State laws vary on how involved a real estate attorney is in the process. For instance, If you’re purchasing a home in Connecticut, Delaware, Georgia, Massachusetts, New York, North Carolina, South Carolina or West Virginia, you’ll need to hire a lawyer to carry out some steps of the overall real estate transaction according to state law.

Additionally, an attorney is required to certify the title and/or prepare documents in Alabama, Kentucky, Louisiana, Mississippi, North Dakota, Oklahoma, South Dakota and Wyoming.

What states require a real estate attorney to conduct the home closing?

States that require a lawyer to be present at closing include Connecticut, Delaware, Georgia, Massachusetts, South Carolina and West Virginia. However, even if a lawyer isn’t required to be present at closing, you still may be required to hire a lawyer at some point of the process.

A real estate attorney can be a real asset when you’re buying or selling real estate. And while it’s not always necessary to have a real estate lawyer when participating in a real estate transaction, hiring an attorney – especially a knowledgeable and trustworthy one – might make the home buying process easier for you.

Not sure where to go from here? Take our home buying quiz to see what’s in your area to get started on your home buying process.