If you have clients who are buying or selling a home, a multi-family property, a commercial building, or land, then you may (bold and underline the word please) want to advise them to use the services of a real estate attorney. Real estate law is a wide-ranging professional area that involves different specialties such as landlord/tenant, commercial, construction, and residential matters. Rather than consulting a general practice business attorney, clients will usually be better off selecting an attorney who specializes in the type of real estate transaction they are involved in. But how do you know which attorney to choose? Here are seven important questions to guide your client’s search:
- Do you need one? Some states require that you use an attorney to handle all or part of the closing process. Most states do not, and even those that do usually use what’s called a “closing attorney,” who is not necessarily a specialist in the more complex areas of real estate law. If you don’t hire a lawyer, much of the work involved in documentation falls to you and/or the title company. Some title companies don’t want to accept that responsibility and require that you hire a lawyer. You can find out if your state requires an attorney at closing by checking with your title company. For the record – I have always advised clients to hire an attorney. I personally have bought and sold over 250 units and have always used an attorney. The return on investment is there.
Even if you are not required to have a lawyer, it may be to your benefit to use one. For example, if there’s any language included in the contract for sale that you don’t fully understand, a lawyer can not only explain what you’re signing but can also tell you if it’s in your best interests to do so. A lawyer can also suggest changes to the standard contract that may be appropriate for you.
- Is it time? Don’t wait until the day before closing, or worse still—wait until you get into some kind of hot water—before you start looking. It takes time to do the research and then to talk to potential attorneys in person until you find one you feel comfortable with. If you think your transaction may have potential glitches or pitfalls, start looking for a lawyer at the beginning of the process, not the end.
- Where do you start? If you don’t have someone you know already, there are any number of ways to begin your search. Your state bar association web site is a good starting point. There are also online directories such as Martindale-Hubbell (www.martindale.com) where you can search by location or specialty. The American Bar Association has a lawyer locator service at findlegalhelp.org, where you can search lawyers by state and specialty. Of course, asking friends and colleagues for referrals may be helpful as well.
- What should you look for? Location, location, location. The attorney you choose should be in your area, both for the sake of your convenience and because he or she needs to be familiar with local law and ordinances, as these can have an enormous impact on how smoothly your deal flows.
- What do you need to know? Once you have a few names on your list, narrow the list with online research. Look at each attorney’s web site. (If they don’t have a web site, go to the next name on your list!) The web sites should give you some insight into the attorneys’ backgrounds, credentials, specialties, and business style. Look to see if they are easy to contact by phone and email, and if they express a business philosophy you feel comfortable with. Also look online to see if the attorneys you’re considering have published any articles, have been in the news, or have had any complaints filed against them.
- Can you tell me about yourself? Once you’ve narrowed your list to two or three, schedule an interview, either by phone or in person. Ask questions about their background and years of experience, how many real estate transactions like yours they typically handle during a month or a year, what specific services they will provide, and whether they will let you contact some of their clients as references. Ask specifically what fees you will be charged and whether they bill hourly or on a flat fee basis.
What’s not to like? Be sure you uncover any potential conflicts of interest. For example, you don’t want an attorney who has done work for the builder from whom you’re purchasing your home, or one who regularly does business with the other party’s Realtor or attorney. But the most important factor is chemistry. You need to feel compatible with the attorney you choose. You need to have a level of trust that he or she will handle your transaction efficiently and honestly, and will consider your best interests first and foremost.
Purchasing a property, whether it’s your primary residence or for investment purposes, is a complex transaction. Having a real estate attorney whom you trust and who will look out for your well-being can make the process less stressful and more productive for all concerned.