By Lisa Wills, Law Offices of Lisa Wills
1. Why Hire a Real Estate Attorney?
Hiring a real estate attorney to review your real estate sale or purchase transaction before it is complete can help protect you from costly mistakes and ensure that contract details are correct, explain legal consequences to avoid problems before they become big issues.
A real estate attorney can guide you from the beginning of your real estate sale or purchase through closing by preparing, reviewing and negotiating real estate contracts and related transaction documents. The attorney can provide guidance to you in a variety of areas including methods to limit exposure to liability, evaluation of title issues, appraisals, disclosures, inspection reports, property conditions and loan documents.
Buying or selling real estate can be a complicated process. People often think that their real estate agent is as experienced as an attorney regarding the legalities and details of real estate transactions. While real estate agents and brokers are aware of the paperwork involved in a transaction, they do not know the intricacies of the law. Only an experienced real estate attorney can help you understand your rights and avoid costly litigation. Real estate buyers and sellers can save money by obtaining the guidance of a well-qualified attorney before there is a problem.
Engaging a real estate attorney for a real estate sale can help to save thousands of dollars when a buyer is identified who wants to buy the property. This type of transaction is called a “FISBO” or “for sale by owner.” In this situation, when the seller hires a real estate attorney they can save the 3% to 6% commission on the sale price when there are no real estate agents representing the seller and buyer. This savings can translate into a lower sale price for the buyer and help the seller gets the real sale price they want.
It is crucial that the seller and the buyer should each have their own attorney to represent their interests in the deal. An attorney cannot represent both a buyer and a seller without a significant conflict of interest.
2. When to use a Real Estate Agent?
In addition to hiring a real estate attorney when you are selling or buying real estate, a real estate agent can add value to your transaction and perform tasks the attorney does not handle. The agent can:
- Provide information about the local real estate market
- Help set the price of your home
- Identify needed repairs and improvements to improve the value of your home
- Stage your home to make it look its best
- Market the property so it can be found by buyer
- Evaluate offers
Look for an exclusive real estate agent who will be focused on your interests and can help you with strategies during the bidding process. Agents paid on commission always have a conflict of interest. Even an agent who represents only you has a financial interest in seeing the deal go through. Experienced, reputable agents do not let this interfere with their guidance. However, less conscientious agents can compromise your interests.
Hiring a real estate attorney to review your transaction documents even when you are represented by a real estate agent can help reassure you that the terms of your real estate agreement and documents are correct and can answer your questions about the legal consequences
3. Do your homework
It is important for real estate buyers and sellers to do your homework to find a real estate agent to help you. Compiling a list of questions to ask the real estate agent helps you find out more about the person you may select.
Consult the California Department of Real Estate (“DRE”) online license search to learn more about a real estate agent or broker, such as whether or not a the agent is licensed to sell California real estate, whether or not the license is in good standing and how long they have been an agent or broker. You may want to contact the DRE directly to see if a complaint has been filed and/or disciplinary action been taken against the agent or broker.
Are you comfortable with the agent’s responses to your questions and the agent’s demeanor and personality? Remember, you will be trusting this agent to represent you in one of the most important transactions of your life.
4. Ask Questions
If you have questions during the process, ask your real estate attorney and agent. It is important to ask questions to make sure you understand the details of your transaction. If you do not understand something, ask.
For more information to help with your real estate sale or purchase, call us at (925) 463-9000 or send an email.
Lisa Wills of the Law Offices of Lisa D. Wills is an experienced real estate attorney in Pleasanton, CA helping educate real estate buyers and sellers so they can minimize transaction complications and successfully close real estate deals. If you are looking for assistance with your real estate deal, contact Lisa Wills by email or (925) 463-9000.