States that require real estate lawyers | What is a real estate lawyer? | When to hire one | Fees and costs | Real estate lawyers vs. agents | Finding a good attorney
You don’t need a real estate lawyer to sell your house β unless the state you’re selling in legally requires you to use one.
In some circumstances, though, like if you’re selling for sale by owner or you’re dealing with unique property issues, it’s in your best interest to hire a real estate lawyer.
But when you’re buying a single-family home in a straightforward transaction, a real estate agent can usually handle the sale on their own.
An experienced agent will know your local laws and regulations, and can also give you a heads-up about any issues that could complicate your transaction. If issues do pop up during the sales process, you can also seek out a real estate attorney at any point.
If you’re ready to sell your home, our friends at Clever Real Estate offer a free service that matches you with top-rated local agents and pre-negotiates big savings on your behalf. Clever’s full-service partner agents will sell your house for just $3,000 or 1% commission!
π° SAVE: Sell with a top agent, save thousands in realtor fees with Clever!
Key Takeaways
- You’re only required to use a real estate lawyer in certain states
- Using a real estate lawyer makes sense in some additional situations, even when it’s not mandatory
- Real estate lawyers usually charge $150-350 an hour, or may offer flat fee rates for straightforward work
When do I need a lawyer to sell my house?
You need a real estate lawyer if you’re selling in a state where it’s required by law.
Each state that requires sellers to lawyer up does so for different reasons, but the ultimate aim for all is to protect the integrity of home sales in that state.
The states that require you to use a real estate lawyer are:
- Alabama
- Connecticut
- Delaware
- Georgia
- Indiana
- Kansas
- Kentucky
- Maine
- Maryland
- Massachusetts
- Mississippi
- New Hampshire
- New Jersey
- New York
- North Dakota
- Pennsylvania
- Rhode Island
- South Carolina
- Vermont
- Virginia
- Washington
- West Virginia
Real estate laws can change, so always check with your agent. They’ll know if your state requires a real estate attorney at any point during your sale.
What is a real estate lawyer?
Real estate lawyers help property buyers and sellers navigate real estate transactions, and to help ensure those transactions meet legal requirements.
A real estate attorney may have advanced contract law experience, but that doesn’t qualify them to act as a real estate agent β agents earn their own licenses from the states they work in. However, attorneys can function as a backstop for your real estate agent.
Β» READ: Whatβs a Real Estate Agent?
For instance, while an attorney won’t negotiate the price or the terms of a sale, they may advise you on any underlying legal issues. For example, real estate lawyers can:
- Identify issues with contingencies in a contract
- Advise you on the best approach for complicated legal issues, like selling a home with a deceased owner or splitting proceeds after a divorce
- Look for loopholes in a purchase agreement and advise you on closing them
- Review buyers’ offers for legal red flags, including potential longer-term legal issues that could arise if you sign an incomplete or sloppy purchase agreement
A real estate attorney also plays a role during closing, reviewing documents and addressing any surprise issues.
Should I hire a real estate attorney if I donβt legally need one?
Even if not required in your state, you may want to consider hiring a real estate attorney to sell your property if you meet one or more of these conditions:
- πYou’re selling FSBO
- π You’re going through a separation or divorce
- π‘ You’re selling a home you’re actively renting
- π© Your property has unique issues
- πYou’re selling a property you inherited from a deceased owner
- π You’re selling a property that’s in bad shape
- π You’re facing a short sale or foreclosure
- π’ You’re selling commercial real estate
- π· Your Spidey sense simply acts up
You’re selling FSBO
If you choose to put your house up for sale by owner (FSBO), you won’t have a real estate agent to guide the transaction.
Unless you’re an experienced seller, consider hiring an attorney to prepare the purchase agreement and other documents. You’ll want the attorney to ensure you comply with your state laws and other intricacies of a home sale.
Look for a real estate attorney who understands and can help with:
- Closing
- Contingencies
- Inspections
- Title issues
Β» MORE: How To Sell Your House Without A Realtor: What You NEED To Know!
You’re going through a separation or a divorce
Whether both parties who own a property have amicably agreed to part ways, or the situation is contentious, you should probably hire a real estate lawyer.
A real estate lawyer can guide you through your big-picture options: Will one party buy out the other, or will you sell the home and split the proceeds?
Whether there’s a buyout or a split of the proceeds, a lawyer can also help you navigate many other issues, like:
- Divorce agreement terms
- Prenuptial agreements, if you have them
- Property’s deed
You’re selling a home you’re actively renting
A real estate lawyer can help you understand your rights as well as your tenants’ rights, and help protect you from litigation.
This is vital if you have people living in your home, as you have to give them adequate notice before selling.
Your property has unique issues
Issues with easements, rights of way, or boundary disputes often benefit from the legal savvy of a real estate attorney.
For instance, if you’ve agreed to an easement that allows your neighbors to use your property, an attorney can help unwind or transfer that agreement before or when you sell.
You may also want an attorney to help you clear any title issues and, if necessary, negotiate with anyone you owe money.
Β» READ: What Is a Property Title Search?
Finally, a federal lien on a property must be cleared before a property can be sold, according to the IRS. Other liens must also be dealt with, or a sale can be delayed or even fall through.
You’re selling a property you inherited from a deceased owner
You might want a real estate lawyer if you inherit a house from a deceased owner, whether or not the previous owner set up a living trust.
If the owner didn’t set up a living trust, you’ll want a lawyer to guide you through probate before you sell the home.
If the owner did set up a trust, find a probate attorney with experience handling real estate in trusts. The attorney can help you understand and abide by the trust, and confirm it’s your right to sell the property.
If you’re one of multiple inheritors laid out in a trust, an attorney can also represent your personal interests.
An attorney can even turn over stones to find and understand any issues that may remain from the previous owner. After all, a deceased owner can’t disclose β and you can’t ask about β potential issues with the house.
You’re selling a property that’s in bad shape
Have a neglected or older home that’s in need of repairs, but you don’t have the cash to do so?
A real estate attorney can tell you what you’ll need to disclose β and address your potential exposure to litigation.
You’re facing a short sale or foreclosure
Whether you’re selling a house for less than you owe on your mortgage, aka a short sale, or your lender has foreclosed on your home and is forcing a sale, you can benefit from a real estate attorney who specializes in financially-distressed properties.
You’ll want to try to secure the best terms with the lender. An attorney can advocate for you in either situation.
You’re selling commercial real estate
Find an attorney who understands commercial real estate laws and, if necessary, can be a strong advocate for your best interests.
Commercial real estate sales are often more complicated and risky than the relatively straightforward sale of a single-family home. They also typically involve more money. In short, the stakes can be high.
You’ll want a real estate attorney to guide you through what can be complicated and risky deals, which can include things like:
- Dealing with multiple revenue streams, like units of a rental property
- Navigating zoning laws
- Understanding environmental laws
Your Spidey sense acts up
Just have a bad feeling during any part of a home sale? Maybe have an attorney check things out. It’ll cost you some money, but the peace of mind a real estate lawyer can bring to a transaction may be worth it.
Another way to deal with challenges like these is to find a real estate agent who has extensive experience in the types of issues you’re facing. Many realtors specialize in foreclosures, for example, or can guide you through the process of transitioning out renters. They’ll also alert you when and if it’s time for an attorney to step in.
Clever’s free agent-matching service is a great way to find agents that specialize in sales like yours. With Clever, you’ll be able to interview multiple agents until you find the perfect fit for your sale AND you’ll only pay 1% or $3,000 in listing fees!
Do I need a real estate lawyer to buy a house?
Usually a great real estate agent can handle a home purchase, but in these situations you may want to consider using a real estate lawyer:
- You’re a buyer not using a real estate agent, and want an attorney to check your contracts
- You face community development agreements, like if you’re buying into a co-op or a regulated planned community
- You plan to change the exterior of your new home, and you face local rules and restrictions guiding what you can do
- You’re securing a private loan from a relative or a friend
Β» LEARN: What can a buyer’s agent do for you?
How much are real estate attorney fees and costs?
Real estate attorneys usually cost $150β350 per hour, and bill by the tenth of an hour. So, you could pay $15β35 for every six minutes of their time. Or, if they’re performing standardized work (like drafting a contract), you may pay a set flat fee.
Over the course of a sale, experts estimate you could pay $800-5,000 to a real estate attorney, depending on the complexity and duration of your case. That’s a wide range, but a real estate attorney will often provide a ballpark estimate of how much you might pay.Β
When hiring a real estate attorney you should also know:
- Some real estate attorneys require a retainer fee β an upfront deposit you’ll pay before they start working for you. How much depends on the individual attorney and your case, but could be anywhere from a few hundred to a few thousand dollars. Have money budgeted for this possibility.Β
- If you pay a retainer fee and your real estate attorney ends up doing enough work for you to bypass that deposit amount, you’ll need to reopen payment discussions.Β
Depending on your needs, you may be able to negotiate a flat rate with an attorney without a deposit for simple contract drafting or other straightforward work. You may also qualify for their sliding fee scale in special cases.
π If you’re interested in learning more about the different costs of selling your home, our friends at Clever can help. Their licensed concierge team can answer your real estate questions or even match you with a local agent. Contact Clever today to learn more!
Is hiring a real estate attorney worth it?
A real estate attorney’s worth depends on your needs and situation.
Because a real estate attorney doesn’t have a direct financial stake in a sale (unlike real estate agents, who earn a percentage of a property sale), they can provide the peace of mind of a neutral outsider. Some people find that’s worth a lot.
Some sellers also appreciate that an attorney can help navigate legal issues and protect them from future litigation or conflict.
But ultimately a real estate attorney’s worth depends on what they can or can’t do for you β and whether a real estate agent alone can fulfill your needs or you need both. Let’s dive deeper.
Real estate attorneys vs. real estate agents: What can they do?
| Task | Attorney | Agent |
|---|---|---|
| Explain the local real estate market | β | β |
| Negotiate home price | β | β |
| Offer soft benefits, like support | It's possible, but not expected | β |
| Protect you from legal issues | β | Only to a degree |
| Provide advice on legal issues | β | β |
| Wield legal influence | β | β |
| Work on hourly rates | β | β |
| Work on commission | β | β |
In general, a real estate attorney doesn’t have an expert understanding of your local market and can’t advice you on its nuances. They can’t help you set a price or negotiate with buyers to get the best possible price for your home.
But, while a great agent provides a shield against common legal threats because of their real estate expertise and experience with home sales, they do NOT function as a legal advisor. Many states actually explicitly bar agents from giving legal advice. A real estate lawyer has the training and experience to handle an array of complex issues, from reviewing documents to representing your interest at closing.
Another major difference is in their payment structure. Real estate attorneys usually work on an hourly fee basis, with a retainer billed upfront, or for a flat fee. Real estate agents work on commission, usually split between your listing agent and the buyer’s agents. This commission may incentivize an agent to sell for as much as possible, which is great if that’s your priority.
Finally, a real estate agent often offers other soft benefits. An agent can offer a sympathetic ear, gentle advice, and all-around emotional support. Since a home sale can be a huge source of stress, a good agent knows how to reassure their clients.
How do I find a real estate attorney?
A good real estate agent can refer you to a real estate attorney. Sellers can also find real estate lawyers through the ββAmerican Bar Association, FindLaw, or other professional organizations, like your state’s bar association.
As you’re evaluating agent-recommended real estate lawyers, or searching on your own, keep in mind an attorney should at least:
- Demonstrate an expert understanding of local and state real estate laws.
- Be personally available on short notice (or an experienced member of their team), in case a crisis occurs.
- Focus on cooperative paths to ensuring your rights, NOT over-the-top marketing claims like winning you millions in court.
- Have extensive experience with situations similar to yours. For example, if you’re dealing with issues in a trust, look for a probate attorney.
You should also ask about costs, including whether you’ll pay by the hour or a flat fee.
Choosing a real estate attorney can be time consuming and confusing. If you’re not sure who to choose or even how to proceed, check with our friends at Clever. Their licensed concierge team connects sellers with agents from major brokerages who have vast professional networks and other experience in matters you’re facing.
Clever can also match you with a full-service agent who can handle your sale from start to finish and save you significant money. The average Clever seller saves over $9,000 in realtor fees!
Related links
What Companies Offer the Lowest Real Estate Commission Fees? Working with a low commission real estate agent is one of the best ways to save money. Continue your home-selling journey by learning about the best low-cost realtors and brokers.
Seller Closing Costs: Hereβs Everything You Need to Know: This guide will help you minimize the 10% of your homeβs sales price it usually costs to sell your property.
Realtor Fees: Seriously, Whatβs Fair to Pay an Agent?: What do sellers actually receive for their money from agents? And can some real estate fees be avoided? This post answers these questions β and many others.
FAQs about real estate lawyers
How much does a real estate attorney cost?
Real estate attorneys cost $150β350 per hour, and usually bill in six minute increments. Or, they may charge a flat fee for certain services. Costs can add up, particularly during complex transactions. Ask in advance for an estimate of how much you might pay.
Should I use a real estate attorney if I'm selling FSBO?
Unless you're an experienced seller, you should hire a real estate attorney to prepare the purchase agreement and other documents when you sell FSBO. You'll want to make sure you're in compliance with your state's laws.
How do I find a real estate attorney?
A great real estate agent can refer you to a great real estate attorney. You can also find real estate lawyers through professional organizations like your state bar association. You'll get the best results from an attorney who follows cooperative paths to ensuring your rights, not someone who makes loud marketing claims.
Rebecca Gardner says
It stood out to me when you said that real estate attorneys actually have leverage and don’t have to rely on negotiation alone. My husband and I have been trying to decide what professional to hire to help us sell our single-family home, hopefully within the next few months. Thanks for helping me understand why working with a real estate law firm would be beneficial for us!
Eli Richardson says
It really helped when you talked about how a lawyer provides key insight during a real estate transaction. Recently, one of my uncles mentioned he’d like to invest in real estate. I believe it’d be a smart move to consult an attorney first, so I’ll be sure to tell my uncle about it. Thanks for the information on lawyers and real estate transactions.