Can Working with a Real Estate Attorney Instead of an Agent Save You Money?

A lawyer can guide you through a real estate transaction. A lawyer can prepare (or check) your paperwork, represent you, and advocate for you. A lawyer runs the title searches, ensuring that the seller has a good title to transfer. Real estate attorneys also handle settlements.  

And yes, using a lawyer rather than a real estate agent can save you a good deal of money. But will the savings be worth it? Let’s take a look.

First, What State Are You In? 

In some states, lawyers handle real estate transactions as a matter of course. Among these states are Alabama, Louisiana, Mississippi, the Dakotas, Oklahoma, Maryland, Wyoming, Rhode Island, and Vermont. And lawyers (independent of the title companies) handle closings in New York.

But most everywhere else, it’s OK to transfer a deed without a lawyer. And some people do get their state’s standard purchase agreement and fill it in. In some states where there’s a choice, people may instead use a limited-service broker to save both money and time.

Or the seller and buyer can work directly with the title company — perhaps the last one involved with the home’s title — to get the paperwork done. Title companies have the basic contracts, and can issue  the necessary title insurance. The title company can give guidance on everything from finding a mortgage lender to recording the deed. 

What Can a Real Estate Attorney Do for a Seller?

A seller needs a sales contract laying out the price of the home, facts about the home, buyer and the seller details, and deed transfer information. Your lawyer can draft a contract to meet the legalities of the state where the sale will happen. If you wish, your lawyer can help you negotiate the terms. 

When you go to sell, you need to know if there are liens, legal claims, or title defects that need resolutions. Your real estate attorney can pinpoint and clear these issues.

If your buyer is using a lawyer, you’ll want your interests represented by your own advocate. In any case, each party must disclose to the other how they are being represented in the sale. The parties should be sure one person’s agent isn’t taking a whole 6% if there aren’t two agents. 

What Can a Real Estate Attorney Do for a Buyer?

Found the house you want on your own? A lawyer with real estate experience can help you buy it. Your lawyer can give you legal advice and draft your contract.

The lawyer can also negotiate the price (taking into account necessary repairs). The lawyer can facilitate a cancellation when legally appropriate. But first, a good lawyer works to resolve disputes between the parties.

The parties to a deed transfer may create the deed themselves. They can still have professionals draft their sale and mortgage documents.   

Need a recommendation for a real estate attorney? When you find a good mortgage consultant, ask for names of local lawyers with closing experience. Or ask a loan officer about using the bank’s lawyer for the closing. The bank’s lawyer could be available to review your title and closing documents. You’ll only find out if you ask.

How Much Savings Can You Get by Using a Lawyer, and Not an Agent?

With agents, most real estate deals run up a five-figure total in agent fees. Most agents (on each side of the deal) are paid a hefty 2.5% or 3% of the home price. (But remember: agents’ fees are negotiable!)

You can get attorney services that you pay for by the hour. Or you can have the attorney handle the full transaction for a flat fee. Depending on location and experience, a real estate lawyer might charge a flat fee somewhere in the $3K range. You’ll need to call for a consultation and ask about your payments options.    

Don’t forget the other fees you’ll pay. You’ll hire a home inspector so you know what repairs and replacements need to be carried out, and how soon. And you’ll need the services of an appraiser, to create a trustworthy evaluation of the home’s fair market value. The lender will need an appraisal if you plan to finance the home.  

Line Items: What Can a Lawyer Do For You?

An attorney can:

• Examine the terms of a sales contract and/or a lending agreement.

• Suggest important changes to a boilerplate contract.

• Conduct a title search; review title reports and closing materials.

• Win concessions after the inspection.

• Prepare and/or review the disclosure forms and the settlement statement.

• Represent a client at the closing, while communicating with escrow and title agents.

• Advise a client on local, state, and federal housing and real estate laws.

• Explain taxation, from transfer taxes to capital gains.

An attorney can also walk you through various ways to transfer or vest your deed.

Without an Agent, What Aspects of the Deal Demand Special Care? 

Ask yourself if you have marketing needs. This may include staging, virtual tours, graphics and a floor plan, post cards, and so on.

When you have an agent, you can rest assured that the price your home fetches will be as high as it should be. In some areas, marketing the home is the key to making the most of your equity as a seller.

While agents cannot give you legal advice, they are knowledgeable about sales agreements. If you’re a buyer, your agent could explain what you give up when you waive contingencies. Let’s go over a few other cautionary points for buyers:

• Ask yourself if you can really negotiate the best terms and price without an agent. If you need guidance with home-hunting, or bidding in a competitive market, then hiring a local agent might really be the best move.

• Ask yourself if you definitely know a minor issue from a truly problematic defect in the home, whether disclosed or not. An agent will expertly compare homes, pointing to key details and differences you might not notice.  

• Don’t rely on your seller’s agent for guidance. Steer clear of the conflict of interest that arises in dual-agency scenarios — where brokers act for both parties.

Review real estate agents’ fiduciary duties to their own clients at Deeds.com.

Agent or Attorney? It’s Your Call.

Most people like to work with an agent of their choosing. But no one has to hire one at all. As sellers and buyers, we have alternatives — one being working with a lawyer. Lawyers who focus on home purchases deal with a range of scenarios regularly, and they generally charge a fraction of an agent’s fee.

Important note: We offer the materials on this website as general information. The information on this site is not financial, legal, or taxation advice.