Buying or Selling a Home: What is the Attorney’s Role?

For most people buying or selling a home will be one of the most significant and perhaps the most expensive events in their lives. As such, it is not uncommon for the parties to experience a lot of stress, excitement and, in many instances, a general bewilderment of the entire process. They will be faced with many unique legal issues that must be considered and dealt with, issues that do not arise with other transactions. A good real estate lawyer has the training and experience to help you navigate these many legal issues and ensure that your real estate transaction is done properly and smoothly.

In the typical real estate transaction the Buyer and Seller are usually represented by their respective real estate professionals who will assist them with the initial stages of the transaction. Those agents will prepare a contract (“purchase agreement”) which will contain the terms of the agreement. As part of this agreement, there will be an agreed “attorney review period” where both Buyer and Seller will have their respective attorneys review their agreement and make any changes, should they be necessary. For example, there may have been terms that were not addressed, left out, vague, or perhaps upon closer inspection even unfair. Specifically, one item the attorneys will address is the issue of earnest money and what the Buyer’s and Seller’s rights are in the event that the Seller cannot provide good title at an agreed time, or at the closing. They will also address unforeseen issues such as defects in the property, municipal violations, liens, to name a few.

The attorneys’ responsibilities will continue from this point until the finalization of the transaction at the closing. The following is a brief explanation of what a Buyer and Seller can expect the role of their respective attorney to be.

The Role of the Seller’s Attorney

Once the parties have reached an agreement the Seller’s attorney will ensure that the title to the property is free and clear and may be sold and transferred to the Buyer. This is done by performing a title examination and obtaining title insurance, which will show the Buyer and any lender that no other person or parties have any legal interest in the property. This process will also identify whether there are any outstanding mortgages or liens on the property that will need to be satisfied prior to or at the closing. If there are any mortgages or liens on the subject property the attorney will work to resolve those or make arrangements to have them satisfied at the time of the closing.

Likewise, the attorney will order and pay for a plat survey (if necessary), which will show whether there are any encroachments on the property, among other things. The attorney will also prepare the deed and all other respective legal instruments.

One of the most important functions of the attorney will be to act as liaison between not only the Buyer and Seller, but with lenders, banks, real estate brokers, surveyors, parties that hold any liens or judgments that may have attached to the property. It will be the attorneys job to make sure that the transaction is ready to close on the agreed date.

The attorney will review all closing documents associated with the real estate transfer and explains them to his client, and will make sure that all monies are distributed appropriately per the purchase agreement; for example, to the brokers, title company, surveyor, city/village transfer stamps, state taxes, etc.

The Role of the Buyer’s Attorney

Similarly on the Buyer’s side, their attorney will review the terms of the agreement and ensure that the agreement protects the Buyer’s interests.

The Buyer’s attorney will also be instrumental in reviewing the materials and legal instruments presented by the Seller’s attorney and determine:

-Whether there are any restrictions on the use of the property? Are there any easements, or encroachments that will affect the use and enjoyment, and perhaps the value of the property?

-Is the title free and clear and can be sold to the Buyer?

-Has the property been altered or there has been an addition to the property, was it done lawfully—were all the necessary permits obtained?

-If the buyer has plans to change the property, may he do so lawfully? Are there zoning issues that need to be considered?

-They will address a property inspections findings, including the discovery of termites, asbestos, radon, or lead-based paint is found? What if the property is found to contain hazardous waste?

-What are the legal consequences if the closing does not take place, and what happens to the down payment?

-Is the closing appropriately conditioned upon the buyer obtaining financing?

These are just some of the issues that the Buyer’s attorney may have to address in their representation of the Buyer.

Finally, the Buyer’s attorney will attend the closing where there will be a final review of all the legal instruments to ensure that there are no clerical errors, and where the attorney will see the transaction to its end.

Conclusion

The role of the attorneys in a real estate transaction is significant. Aside from reducing stress and confusion for the Buyer and Seller, they will ensure that their respective client’s rights are protected and that the transaction is conducted in the smoothest possible manner. Therefore, a Buyer and Seller should always consult with and use an experienced attorney to assist them in their real estate transaction.

LANGFITT LAW, LLC

1320 Tower Road, Suite 103

Schaumburg, Illinois 60173

847-301-4250

www.langfittlaw.com

Disclaimer: The information contained at this site is not, nor is it intended to be, legal advice. You should always consult with an experienced attorney for advice regarding your individual situation. We invite you to contact us and welcome your calls, letters and electronic mail. Please be advised that your contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established and you have been asked to do so.