Real estate attorney or real estate agent

[Mike Girenko]

Hello BP community,

A question about using real estate attorney... I found a For Sale by Owner property which looks interesting. Should I use a real estate agent to purchase it, or a real estate attorney? I understand that I will need to pay an agent his commission, but will it be more or less expensive than using an attorney? Any other advantages if I use attorney and not an agent?

Thank you!

[Matt B.]

I tend to lean towards a RE attorney but I'm kind of bias since my wife is a RE attorney. They have different views and area of expertise. I would use an agent when I'm looking in a new area or want some area/market insights but unless you hire a buyers agent, the agent works for the seller, at least that's how it is in NYC. A RE attorney can tell you about recent sales they have done, a good RE attorney can tell you about trends and help with any and all legal aspects of RE transactions. Where I am in NYC, I tend to lean more with attorneys than RE agents. The market is flooded with RE agents but not so much with RE attorneys. It's almost guaranteed that any RE attorney sat at more closing tables than any RE agent because there are far less RE attorneys than RE agents. 

[Mike Cumbie]

Hi @Mike Girenko

They both have different purposes. I can't speak to Colorado though as each state is a bit different. Here agents can give you "value" of a property, where attorneys provide "Contract language security". So if you know the value and you know the area and you are sure how to do the transaction then just use the attorney. The attorney (At least here) will make no representations on the value of the property, if you want to pay 1.9 Million on a house worth 85K the attorney will generally ensure you are protected in the contract to do just that (They don't usually know the houses themselves and don't step foot in them)

Good luck in whatever you decide.

[Mike Olson]

Hi Mike,
If the seller is open to paying an agent as some of them are then I'd go that route. If not, I would do it through an attorney as long as you are comfortable with the in's and out's of buying a property. Agents are there to explain things and help you through the process but if you don't need that type of help, then an attorney is a great option. I have an awesome local attorney if you'd like to chat with him just pm me and I'll get you his details.

Good luck!
Mike

[Bill S.]

@Mike Girenko so as a disclosure. I am an agent. My advise for a FSBO would be to use and attorney and a title company. The title company can guide you on dead lines and attorney review terms. The fact is if you just need an agent to referee the deal you can likely find one to do it for about the same as an attorney. Other than shopping for agentsto do it for a small fee attorneys are the quickest and cheapest (never thought I would say that). Keep in mind, many managing brokers want no part of FSBO deals where all their agents are doing is preparing contracts. The Real Estate Commission tends to view that as shirking some their duties as agents.

For you, the process is to get the standard form contract off the state's web site. Fill it out to the best of your ability, discuss time frames with your money person and title company (many have a cheat sheet closing schedule). You and the seller sit down and fill it out together. Have the attorney review it. Also have the attorney review the title work when it comes in.

[Jeff Schwarz]

My suggestion is always use a certified licensed real estate attorney.  One that specializes in real estate.  Costs a little more but you have his/her complete attention all the way through the closing.  Yes allow the attorney to do the closing.  Title companies are great but and attorney that works for you is just that, working for you to make sure everything is right etc. 

[Lynn McGeein]

If you are comfortable with the process, sure about your offer price and terms, can handle your own negotiations and contingencies like loan and home inspection, then finding a good attorney who will draw up the contract and advise you when necessary and handle settlement can be a great option.  There are usually attorneys who offer the package from contract through closing for a set fee -- I've done this as a seller, not a buyer, but the buyer was fine just using my attorney as well as we had already verbally agreed on terms.   If you are not comfortable with the process or negotiating with sellers or determining price, an agent can be invaluable.  The agent can usually work out their commission with the seller, and many will negotiate a lower commission as buyer and seller have already found one another.  But even with an agent, a closing attorney or settlement agent would still be necessary.