Hiring a Real Estate Attorney

            Lawyers are too expensive. You just don’t need a lawyer to close a real estate deal. Lawyers are deal breakers—they find problems where none exists. Too many lawyers don’t understand real estate and they aren’t the true real estate experts.

            These are the typical reasons given by buyers and sellers who chose to close their real estate transactions without the help of a lawyer. But truly experienced buyers, sellers, real estate agents, lenders and developers will tell you that you should never go into a real estate transaction without a lawyer. A real estate purchase will confront you with the largest collection of fine print you will ever see. Every line you sign, every box you initial and every notice you accept is there for a reason and has legal meaning. Sign without a lawyer and you may end up waiving important rights or denying yourself the protections to which you are legally entitled. Sign without a lawyer and later you may pay a litigation lawyer much more money than you could have paid a real estate lawyer.

            Real estate brokerage offices, mortgage companies and developers have their own lawyers. While it may not be obvious to you, you will be the only person in the transaction who isn't really represented if you don’t have a lawyer. Everyone at the closing table is representing themselves, not you—they are obliged to protect their own interests or their company’s interests first and no one has your interests as a priority except your attorney. On the occasion when you are possibly spending the largest sum of money you ever will spend in your life, you should hire a lawyer to advise and protect you.  

            Lawyers are not too expensive. Buyers often pay several thousand dollars in mortgage “points,” and then decide that they can’t afford an attorney. Sellers often pay many thousands of dollars in commission to their real estate broker and sign a deed prepared by a non-lawyer. Mortgage lenders and realtors are entitled to charge for their services, but buyers and sellers need to know that the typical real estate lawyer’s fee for a residential real estate closing is a tiny fraction of most mortgage points or real estate commissions. Most Pocono area lawyers charge a fee in the area of $500 to represent parties to residential real estate transactions. Selling or buying a home valued at hundreds of thousands of dollars easily justifies paying realtors and mortgage lenders and equally warrants spending $500 to secure an expert on your side whose sole goal is to focus only on your interests.

            It is true that in Pennsylvania you don’t need a lawyer to close a real estate deal. In a number of neighboring states only an attorney may prepare the necessary documents and hold real estate closings. But in Pennsylvania a real estate closing may be organized and managed by a non-attorney. While many accurate and successful closings are held by responsible non-attorneys, real estate transactions are governed by real estate law. Because real estate law is complex, many lenders, realtors and title insurers agree that wise buyers and sellers always should have competent legal counsel at the helm of their real estate closings. One of the most important instruments for closing is a deed, which transfers ownership of property from the seller to the buyer. There are several types of deeds, such as "warranty deed," "special warranty deed," and "quit claim deed." Buyers can take title as tenants in common, joint tenants or tenants by the entireties. The type of deed affects the buyer's rights against the seller. The manner in which the buyer's name appears on the document is also important, since it profoundly affects the form of ownership and future tax consequences to the owner. You don’t need an electrician to repair your wiring, but isn’t it better to hire one rather than give the task to a general construction worker?  

            Lawyers don’t break good deals, they break bad ones. When you sign an agreement of sale, many people involved have worked hard and invested money in the deal but they won’t make any money on the deal unless it closes. There is always pressure to get the deal closed. Sometimes it is a lawyer who identifies a significant flaw in title or who convinces an eager buyer to slow down and hire a competent home inspector. Sometimes it is a lawyer who counsels a buyer to get a more accurate appraisal or to change lenders to secure a loan with better terms.When your doctor helps to resolve your health problems he or she doesn’t make your neighbor sick. But when your lawyer protects your interests, all too often someone else winds up feeling shortchanged. Anyone who broadly claims that lawyers break deals isn’t focusing fairly on lawyers’ absolutely unswerving loyalty to their clients and isn’t candidly acknowledging that some deals deserve to be broken.

            The right lawyer for you is one who understands real estate deals. Lawyers pursue many different specialties in the law. Sometimes buyers and sellers rely on lawyers who are family members or friends because doing so is easier than going out and hiring a lawyer who is a stranger. As a lawyer of twenty-five years experience who is blessed with seven siblings, eighteen cousins and sixteen nieces and nephews, I’m painfully familiar with the role of consiglieri and I’ve learned to serve my relatives best by staying within the confines of my experience. Don’t have your sister-in-law who works for a large urban law firm specializing in employment law represent you at your home closing. Don’t involve your college buddy who is in-house counsel to a corporation. Instead, ask him or her to help you hire an experienced real estate lawyer. Lawyers regularly use national directories of lawyers to find and communicate with other lawyers—your lawyer friend or relative can give you great advice on how to find and hire a good lawyer. You also can seek help from your realtors, builders, developers, mortgage brokers or bank loan officers as they generally maintain lists of experienced lawyers who regularly practice real estate law. Don’t let yourself be steered to a single lawyer or law firm—expect to be given a list of choices. You are entitled to independent representation and should not use the lawyer who represents anyone else involved in the transaction. Armed with several names, check the firms’ websites or call their offices. You can learn a lot about a lawyer by your initial contact with his or her staff.

            My grandmother knew how to stretch a nickel but she also was quick to lament “penny wise, pound foolish,” when she felt one of us had spent a large sum of money without planning wisely. When spending an enormous sum of money on your home, you will spend most wisely if you also pay for the protection you deserve from an experienced real estate lawyer.

            Stroudsburg Attorney Jane Roach has twenty five years of experience and provides representation in real estate transactions, title insurance and complex real estate litigation. For more information about Jane Roach, contact her at 570.421.7009 or visit her website at www.jroachlaw.com.