Why Real Estate Attorneys Are Essential During Closing
You may think that buying or selling real estate is a simple process where the property buyer and seller agree on a price for the property, sign a contract confirming that agreement, wait for the loan to come through, the seller hands the keys to the buyer, and that’s that.
There is a lot more to it. Connecticut is one of 21 states (and the District of Columbia) requiring real estate attorneys to be involved in the real estate sale and present at closing.
Even in states that do not require a real estate attorney, the mortgage lender may need one. There are many reasons why both buyer and seller should use a real estate attorney, and have the attorney present at closing, regardless of whether their state law requires it.
The Role of a Real Estate Attorney
A real estate attorney reviews the sales agreement and determines if there is a need for negotiations on any of the terms. A home inspection is a standard term of the real estate contract. After the home inspection is complete, the attorney can negotiate the resolution of any repair issues that have been identified.
The attorney conducts the closing to be sure everything is in order and to reduce the risk of issues popping up in the future.
How a Real Estate Attorney Assists Sellers
Even if not required by law, there are several situations where sellers should seek attorney services. A few examples include:
- There is a lien on the property you want to sell.
- You inherited the property or are the executor of the estate of an owner who is now deceased.
- The property is distressed and may have structural problems.
- You need legal intervention when any issue arises that might jeopardize the closing of escrow.
- Your partner is uncooperative and does not want to sell the real estate.
- Your intuition makes you uneasy, and you just “feel” like something could go wrong.
- A real estate attorney will ask the questions you might not have thought of asking.
How a Real Estate Attorney Assists Buyers
When buying a property, it is easy to get swept up by the “curb appeal” and the dream of living in the home. Remember that is not how the home will look with your things moved in.
Keep the emotions out of your purchase and have your real estate attorney help guide you through the buying process. Some situations where an attorney will help include when:
- The bank owns the property.
- The sale is a short sale.
- The property is part of an estate sale.
- The property is in an area with problems, such as in a flood zone or tornado-prone, or where high toxicity of dangerous chemicals is found in the air.
- The property you are buying is in a different state than your current home.
- You are buying commercial property.
Can the Buyer and Seller Use the Same Attorney?
The easy answer to that question is “no.” Representing both buyer and seller creates a conflict of interest. Attorneys have a responsibility to advocate for their clients. It is possible that during a real estate transaction, the buyer and seller have conflicting interests. When this happens, the attorney cannot fairly represent the interests of both parties. In some states dual representation is authorized with the consent of the parties, but it is never a good idea.
Why Real Estate Attorneys Are Essential at Closing
Real estate attorneys are essential at closing to make sure there has been a successful walk through, the mortgage has been funded, title insurance is procured, and the deed is appropriately transferred. This involves:
- Examining the title to be sure the title is clear.
- Making sure there is title insurance.
- Paying off all loans that were on the property.
- Explaining the significance of all closing documents to buyers and sellers.
- Recording the deed and disbursing the funds.
While some states might not require an attorney at closing, as you can see, it’s not only required in CT, but it is important to ensure you check all your boxes and have an advocate on your side. Get in touch with your local law firm today to start your real estate journey.
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