Do I Need a Lawyer for a Real Estate Deal?
There is a certain resistance I have noticed to using a lawyer for real estate transactions. As far as I can tell, most transactions in Decatur, Illinois are done this way. Most people use the title company for both title review and escrow and never hire a lawyer to shepherd the deal.
Yes, you should have a lawyer.
Don't get me wrong, the local title companies do good work. So do local real estate agents. But there are certain things that are better left to a lawyer who is representing only your interests. Let me explain.
In the average real estate deal, there are three actors plus the title company. First, there is the seller—they have the house and want to sell it. Second, there is the buyer—they like the house and want to buy it. Third, there is the bank that is providing funding for the seller. Finally, there is the title company that reviews the title history, prepares closing paperwork, and handles the transfer of funds. On top of that, both the buyer and seller often have a real estate agent.
If you are the buyer or seller, your real estate agent is arguably working solely for your benefit. But your real estate agent cannot practice law. Your real estate agent cannot review the title to make sure there are no problems that will impact you. The title company will review it, but their review focuses on whether the property can be insured for the bank—not you. When the final walkthrough shows a problem, who is going to negotiate that fix for you? That's not the title company's job. The bank doesn't care. Your real estate agent may be able to help, but they have a vested interest in the deal getting done. The best person to do that negotiation for you is your lawyer, if you have one.
You do not need a lawyer in the perfect real estate deal. But in my years of practice, I have never seen a perfect real estate deal. Dealbreakers are uncommon, but problems with the deal where I've saved clients money and time in the short and long term are numerous. I've resolved title issues, boundary line issues, final walkthrough issues, financing issues, and myriad other problems.
You can save a paltry amount of money by not hiring a lawyer for a real estate deal. You can sell it or buy it using a contract filled out by your real estate agent that has never been reviewed by counsel. But by doing that you're gambling that the real estate deal will go ahead perfectly without any issues. I have never seen that happen. If any issues crop up, there's a good chance you'll spend four times as much money and time dealing with those problems than if you had just hired a lawyer at the outset.
In the end, it's up to you. I'm not an trying to be an alarmist. But resolving real estate issues after the fact will cost you significantly more than the fee for an experienced real estate attorney. And seriously, you're spending between $50,000 and $400,000 on a home. It's a big investment. Isn't it better to do it the right way?
You tell me.