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Why Use a Real Estate Attorney to Buy or Sell Property?

Updated: Jan 15, 2021

Buying or selling your home or property can be an exciting yet daunting task. Often the purchase of a new home or property is the most substantial purchase in your lifetime.

In addition to the emotional issues associated with buying or selling a home or property, there are a host of legal issues involved. Seeking legal advice and/or review of your purchase can ensure a much smoother process. And in some cases, the use of a qualified real estate attorney can be a more cost-effective approach than a real estate agent.

Using a Realtor or Real Estate Attorney

In most cases, a buyer or seller of property will use a real estate broker or agent to assist with the sale or purchase of property.

However, there are important considerations for using a real estate attorney in addition to or instead of a Realtor. Let’s look at both:

A Realtor can provide helpful insight into the local real estate market, up-to-date listing information, marketing advice and assist in negotiating a fair price for your home.

A real estate attorney can review any listing agreement and the buy-sell agreement to ensure all of the potential legal issues are addressed. An attorney can also help you understand the confusing commissions and closing costs you will be required to pay.

Realtors often use standard forms that may not address your unique issues of the property or sale.

Significantly, a real estate attorney can review the title commitment to ensure you are aware of and adequately address any title exceptions that may cause a problem in the future.

Even if you utilize a real estate broker, you may want to consider bringing on a real estate attorney to review the fine print of titles and contingencies. These are often where deals break and it is best for you to have multiple professional eyes looking out for your best interest.

Best Use of a Real Estate Attorney for Sale or Purchase of Property

A real estate attorney can assist with all aspects of the sale or purchase of real estate from the initial offer through closing, and often at a much lower cost than the commissions for Realtors.

Document Drafting and Review

Buying or selling property requires a mountain of documentation! A real estate attorney can draft or review all of these, including: offers, buy-sell agreements, financing documents, deeds, and other documents for conveyance (legal transfer of property).

Even if an attorney does not draft these documents, a real estate attorney can provide review and essential insight for you. Their job is to ensure the contract and associated sale documents are correct, do not omit essential terms, and that you understand the terms contained in the agreement.

Title Status and Title Issues

Most real estate sales require the buyer to obtain a preliminary title commitment for the property. A title commitment will show you any encumbrances (legal restraints) on the property, such as easements or restrictive covenants that may impact your use of the property.

Advice from a real estate attorney within this process can be especially valuable. We can explain what certain title exceptions mean and how they might impact your property use and value.

For example, one of the most common types of encumbrances on property is an easement. By definition, an easement is a “nonpossessory” interest in the land of another individual that gives the easement holder the limited right to use the land of another.

Many people living outside of the city limits may have some type of road or utility easement either on their property, or used to access their property.

If you are considering purchasing or selling property it is important you fully review any easements and related agreements to ensure you understand and agree to the terms.

If the title commitment raises any potential issues with adjoining property, an attorney can help resolve the potential issue before you purchase the property.

Zoning Restrictions and Subdivision Regulations

If you plan to purchase a home to use for a particular purpose, such as a home business or farm, a real estate attorney can explain the zoning restrictions on a particular property. A real estate attorney can also determine whether you are able to subdivide the property and the process required to subdivide.

Water Rights and Environmental Issues

A water right is a type of property right, which means it can be bought, sold or transferred.

Water rights are normally transferred with the sale of property, but sometimes the previous owner reserves the water rights from the sale.

A reservation of water rights must be specifically written into the deed. If a seller does not reserve the water rights then a water right transfer certificate must be filed to ensure the water right documentation is updated with the state.

An attorney can review the transfer language in the deed and associated documentation to ensure the water rights are properly transferred with the land, and assist in determining the nature and extent of water rights associated with a particular property.

Similarly, a real estate attorney can also assist in determining whether there are any environmental issues that may impact the property.

If there are existing environmental issues, such as a spill or other environmental contamination, an attorney can explain how this might impact your ownership or future development. We can also provide advice on how to address an environmental issue within the sale process.

Resolving Disputes and Litigation

Even if you thoroughly address all potential legal issues in advance, real estate transactions do not always work out as planned. If a sale falls through an attorney can assist in attempting to resolve a dispute and negotiate the best outcome for you.

Ultimately, if attempts to resolve the situation are not successful, an attorney can assist with the litigation associated with the transaction and related agreements.

Seek Legal Advice at the Beginning of the Process

If you are interested in buying or selling real estate consider bringing on a real estate attorney at the beginning of the process to help reduce potential problems down the road.

Even if you work with a real estate agent, a real estate attorney can assist in navigating the entire process to ensure you understand and agree to all the terms of the agreement, and if not, can negotiate better terms or resolve potential issues prior to the property sale.

If you are in need of excellent real estate representation, contact Measure Law.

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