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Why Do I Need a Real Estate Lawyer?

Why Do I Need a Real Estate Lawyer?

Buying property and/or a home is one of the heftiest decisions, and one of the largest purchases, some people will make over the course of their entire lifetime. During this overwhelming experience, it’s easy for convoluted details to slip through the cracks. Money for fees that don’t need to be paid can get doled out to fraudsters, or enterprising vendors. Devastating long-term financing can be foisted on you (without you even being aware of signing hard-earned money away based on a covertly worded document). And, in cases where people are buying property without homes on it, there might even be a 50 page purchase agreement to decipher. All of these dangers lurking around every corner can be boiled down to the “law of real property”.

Pink glass piggy bank with coins laying around it

Law of real property is distinctive, raising unique issues of practice, and special difficulties that don’t come up in other transactions. A real estate lawyer is specifically trained to swim with ease in these murky waters. He or she has plenty of experience with the law of real property, and in the U.S., some states even certify these types of lawyers as “Real Property Specialists” because their expertise is so honed to the task. Hiring the right real estate lawyer early in the game can save you time, but most importantly, save tremendous risk – and money.

A real estate lawyer is guaranteed to have your best interests in mind from the start. You are their client, and in the landscape of lenders, buyers, financiers, and sellers, your lawyer is the only third party who will represent you with thoroughly educated objectivity. For example, a lawyer will protect your rights when it comes to financing. Some people have dreadful rates imposed on them because they neglected to get a real estate lawyer to review all of the forms. This happens when an important distinction (that a lawyer would catch) is not made in the paperwork: instead of putting down “offer conditional on the buyer getting the financing they need” a purchase agreement can merely state “conditional on financing.” This means that if the bank offers a higher rate like 5% financing (instead of a lower percentage), the buyer doesn’t have the option to back out of the deal. If said buyer received the financing, and that was the condition; nothing was specified about the rate of financing. “Conditional on financing” is just one illustration of many broad (and therefore dangerous) clauses. A lawyer is there to catch all kinds of hazards like these before you’re sucked into a situation with negative long-term results.

Hiring a real estate lawyer is important, but finding the right real estate lawyer is crucial. When you work with a real estate agent, they can make a recommendation. Alternately, perhaps a member of your family, a friend or co-worker can endorse a real estate lawyer that they have worked with in the past. The best way to find a lawyer is by gathering those good old-fashioned references. Seek your potential lawyer’s former clients who can tell you great things about the services they received during their own home-buying experience. Don’t forget to take at their Google or Facebook reviews if available, as they too can be good indicators of their clients service experience.

If you can’t go the “reference” route, it’s possible to check with the Ontario provincial law society to make sure that the lawyer you’re considering is in good standing (or to find one that’s local). You can also go to the provincial law society to find lawyers or paralegals in your area willing to give a free consultation. (Click here to visit their website. No matter how you feel most comfortable finding your lawyer, it’s universally recommended that they spend 90% (or more) of their time on residential real estate. Don’t hire a lawyer who is busy with other tasks, and does a real estate transaction here and there. Spend your money on an accomplished lawyer with a specified skill in this field. When you’re putting your life savings on the line, cheaper is not better.

Lenders will offer you an alternative to a lawyer when it comes to providing a “closing service.” If you do use their real estate title and closing services, they should include:
– Title/availability tracking
– Contract execution/return management
– Title procurement/issue resolution
– Follow-up conditions
– Management of contract addendum
– HUD-1 reviews
– Review of contract
– Closing date projections
– Confirmation of funds or wires or are services you can easily find online. But as you can see, the term “closing service” involves a wide range of tasks. Using FCT or FNF is cheaper, but your timeline will be extended; and it’s recommended that you get a real estate lawyer nonetheless.

Your property purchase can affect you positively, or negatively, for the rest of your life. A specialized expert working in your corner is the best way to protect your interests when it comes to navigating the nooks and crannies of property law. Although there are “cheaper” options, it’s beneficial to relinquish that tight hold on nickels and dimes when it comes to protecting the investment of your lifetime, as it could save you plenty more in the future.

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