Do you need an attorney for a real estate closing? Yes, you do, but the real question is what kind?

I get a few calls a week from people looking to buy a home and they “want an attorney”. But do they really? I always offer to meet and discuss representation but then I hear “I have a guy who will do it for $— and if you won’t beat that price, then there is no reason for us to talk.”

I understand that some things can be bought like a meal at a fast food restaurant but that is not how I work. Here is what I have been told is the normal process for a low-cost closing attorney:

Initial contact with client 10 minutes
Review deadline dates 10 minutes
Send letter of introduction to seller 10 minutes
Call with amount to bring to closing 10 minutes
Attend closing 60-90 minutes
TOTAL: 1.5 – 2 hours

This works well for simple transactions and with very well-versed buyers. The problem is that a lot can happen in a real estate deal and often times the transactions can be more complicated than you realize. Lawyers who charge a fair price and offer in-depth service follow more of the process below:

Initial contact with client 10 minutes
Review contract and terms including dates, request additional time for attorney review and inspection. 45 minutes
Call client and set meeting to review terms of contract. Request that the inspection be sent over prior for review. 10 minutes
Meet with clients to go over terms of contract and confirm that they have full understanding. Talk about financing and the results from inspection. Explain the attorney review period and talk about changes and credits they need. Talk about money needed at closing. 60 minutes
Draft attorney review letter and send to the seller. 30 minutes
Call client with the reply. 10 minutes
Call lender for status and confirm closing date. If  an extension is needed for the mortgage contingency draft letter and send. 15 minutes
Review title and communicate any issues with the seller. 20 minutes
Days prior to closing notify client of amount to bring to closing 10 minutes
Attend closing and review all documents with client so that there is full understanding. 60-90 minutes
TOTAL:  4.5 – 5 hours

At the end of the day the real question is “What do you want when you buy your home?”

A true story from this week: a man called and told me that he and his wife bought a condo 3 years ago and lived there quite happily. The plan from the start was to move out and rent the unit for income when they were ready to start a family. The couple placed an ad and found a renter, but someone from the condo told them they could not rent the unit out and that rule was in the condo documents. Although the realtor knew renting the unit out later was their desire and there were other renters in the building, that restriction was never raised by the low-cost attorney that the couple used. Now their income dream is crumbling and they will have to sell the condo.

The process of buying a home may be handled by a transactional attorney, but it is your home and greatest investment and should be treated as more than just a simple transaction.

Posted by: jorellana on February 4, 2016
Posted in: Real Estate