One of the biggest purchases in a person’s life is buying property. In today’s world, it takes a knowledgeable team of people to get a deal closed. One of the key players on a buyer’s team is a closing attorney. Some believe that an attorney is not needed to close a real estate deal and they are right technically. However, being right does not always make a person wise. The number one reason a closing attorney is needed is to protect the buyer by making sure they have a real contract with the seller. An attorney reviews the contract within a 3 day time period to make sure the legal language is correct and the time frame in executing the contract is within the legal guidelines of state and federal law. Once the attorney review is over the buyer officially has a contract with the seller.
The second reason having a real estate closing attorney is helpful is that he/she will help get the deal to the closing table. An attorney will make sure an escrow account is set up by the Realtor or attorney’s office to hold all down payment monies on the property. The attorney will make sure that those funds are safe and secured and available for closing day. He/she will make sure the mortgage loan money is available to transfer to the seller.
The third reason a buyer needs a closing attorney is that he or she will order the title work on the property. The title work shows ownership of the property, transference of ownership and whether any liens are clouding the deed. The attorney will make sure the buyer gets title insurance to protect the deed from any unforeseen claims to the property. In addition, the attorney will do a search and make sure there are no judgements on you that would impede the purchase of the house. For instance, the attorney’s search will make sure the buyer and seller does not owe any child support payments. In most states, if a person owes arrears in child support that money must be paid first before anyone else gets paid at closing.
The fourth reason is to assist the buyer in getting the seller to address any repairs that need to be completed before the sale of the house. For instance, if you have an FHA (Federal Housing Administration) loan and your home inspector found a few things that needed to be fixed, FHA will require those repairs be resolved prior to closing. Your attorney would communicate with the seller side to get things done. The attorney will send memos to the selling party’s team to get the buyers request or questions documented and answered.
The fifth reason is that the attorney schedules and facilitates the closing transaction. The real estate closing attorney makes sure all parties have a representative present at closing that is authorized to sign documents. In addition, the attorney is the one that makes sure all funds in the deal are accounted for and given to the proper party. The attorney goes over the loan documents with the buyer to make sure he/she understands them. Another reason an attorney is needed is because he/she can help you exit out a deal without paying a large percentage of your down payment money to the seller. It is very wise to get a real estate closing attorney to facilitate your transaction because it is costly not to have one. It makes no sense to be a penny wise and a pound foolish.