The Truth About Using an Attorney During a Home Purchase
By: Loretta Tsiskakis, Esq.
When purchasing real estate in Florida, buyers often overlook the benefits of working with a real estate attorney during the transaction because they assume it will increase the length of the process and be more costly. This is not necessarily true. While both title companies and law firms may issue titles: only an attorney trained in real estate transactions can also help you overcome legal issues that may surface from contract to closing. In this situation, using a law firm may kill two birds with one stone.
Who Holds Title?
One of the most important decisions you will need to make when purchasing real estate is how to take title to the property. There are many options available and, depending on your situation and/or the size of your estate, this decision may require some experienced professional advice. In most simple transactions, title is taken as an individual, or as husband and wife.
However, buyers may also select to title as jointly with full rights of survivorship, in a trust or in a limited liability company. Navigating which is right for you is not a service most title companies offer. An attorney with experience in real estate transactions can provide counsel and discuss the legal aspects as well as the tax advantages of each available option.
Dollar for Dollar
A common misconception associated with using an attorney for a real estate transaction is that it will be costly. Many buyers assume that retaining a law firm to manage closing is not as affordable as the fees set by title companies. Yet, the two major costs involved with purchasing property are title insurance and standard closing items like inspections, documentary stamp and recording fees.
Insurance rates are set by the Department of Insurance so obtaining title insurance through a law firm or a title company should reflect the same rates. However, in our experience, closing fees are often more affordable at a law firm as opposed to a title company. So with title insurance and closing costs being relatively the same at each business, you are free to make your decision based on the level of service and oversight you wish to receive.
Just in Case
In the unfortunate event that your buying experience hits a legal snag, your real estate attorney can step in with the legal representation necessary to remedy the situation. This includes legal advice, tactful negotiation, draft preparation, and review of any non-standard documents that may come into play throughout the course of the home buying process.
In more intricate real estate transactions such as purchasing from a trust or estate, or complex transactions of very high-valued property or commercial property, an experienced real estate attorney can scout for unforeseen obstacles like unpaid fees and taxes, improperly recorded liens or – worst case scenario – seemingly fraudulent title holdings.
A real estate purchase is often the most expensive investment in your life. It’s also an asset that needs to be titled properly so as to become a legacy and not a burden to your loved ones. Working with a real estate attorney during the buying process can reduce the number of unforeseen issues and costly mistakes that may surface during the transaction.
Loretta Tsiskakis is an associate attorney in the firm’s real estate law department.