can i save money using a real estate attorney instead of a realtor when buying a house?

You still save money compared to working with a real estate agent It’s not cheap to hire an attorney, but it’s less than what you’d pay in commission working with a real estate agent (typically 5.8% of the sale price). Average hourly fees for real estate attorneys range between $150 and $350 per hour.

Full Answer

Why should you sell your home using a real estate lawyer?

 · What happens when you use an attorney rather than a real estate broker to buy a house? It's been known for a long time - you save a lot of money. Like tens of thousands of dollars, depending on the price of the house. Most buyer's agents are paid 3% by the seller. A real estate lawyer costs $2500 or so. On a $600,000 house, you'll save up to $15,000.

Do I need a real estate attorney to buy a house?

 · If you’re looking to save money when buying a home, you may want to let only the listing agent represent you instead of having a buyer’s agent. This is called dual agency. It’s an unusual move, but one I’ve conducted three times. Overall, this strategy has saved me …

How to sell a house without a real estate agent?

You can ABSOLUTELY save money by not using a realtor! I'll go into more detail below and address a lot of the points brought up in this thread. The 5-6% is indeed negotiated between the seller and their agent before a sale. I would not simply go in there and offer less based off the fact that you don't have an agent.

How much is a real estate attorney worth?

Sell Home Using Lawyer – Not an Agent

Sell Home using Lawyer Instead of Real Estate Agent and save $30,000 to $90,000 or more!

Real Estate Attorney –OR– Real Estate Agent?

The process of selling or buying your home is quite complex. Many states 1 require buyers and sellers to use a licensed Real Estate attorney to close a sale.

MY QUALIFICATIONS

I am BOTH a licensed Real Estate attorney AND a DRE-Licensed Real Estate Broker!

Value of a Real Estate Attorney on Your Team

There are numerous reasons why you should sell home using lawyer assistance. You are in California where non-attorney real estate sales agents can assist you in the purchase or sale of your home, but even their literature advises you to involve a real estate lawyer!

Times Are Changing in Real Estate Transactions

Like Amazon turning shopping malls into cavernous ghost towns.. For most people with some smarts in their local real estate market, it is easy to do your own searching, value assessment, and mortgage pre-qualification when searching for a home to buy (or sell). Many people simply do not need a real estate agent anymore.

Deer-in-the-Headlights on Binge-Signing Day

Many real estate buyers and sellers find themselves without any legal advice or counsel throughout the entire real estate purchase/sell transaction. Then… it is ‘escrow closing day’. Binge-Signing Day! You might sit down with a professional “signature gatherer” or at the desk of a busy escrow officer.

How do real estate agents get paid?

Real estate agents are usually paid by commission, which they will only receive if the transaction closes. If the transaction doesn’t close, they aren’t paid. This means agents are motivated to “seal the deal,” which on the surface may sound like a good thing. But that motivation may cause an agent to push for a closing that might not be in your best interest.

What are the obligations of a real estate agent?

A real estate agent’s obligations to his or her client are somewhat limited, and he or she may not necessarily be working in your best interest. For example, a real estate agent can represent both the buyer and the seller in the same transaction, or could even be the buyer, which obviously could leave you in ...

Do real estate attorneys have a duty to their clients?

Attorneys, on the other hand, have a very clear duty to their clients. The real estate lawyer-client relationship provides for a high degree of privacy and confidentiality, which does not exist in a real estate agent-client relationship. A real estate attorney will be representing you and only you in the buying or selling of a house, ...

Do you need a realtor to buy a home?

Lastly, many transactions may not require a realtor or real estate agent to sell or help buy a home. This especially applies to “For Sale By Owner” arrangements, owner finance arrangements, and other direct buyer-to-seller or seller-to-buyer transactions.

Is a real estate attorney better than a real estate agent?

You can probably infer that a real estate attorney is better equipped to provide you with legal guidance than a real estate agent is. Agents can fill out forms, but they can neither draft forms nor modify existing forms. They also cannot provide legal advice regarding those “standardized forms”—only an attorney can do that.

Who is involved in the transactional phase of a property sale?

Furthermore, while it is typically advisable to hire an agent for the marketing and advertising portion of the sale of your property, it is the real estate lawyers who will typically get involved during the transactional phase.

Can an attorney draw up a contract?

Attorneys, on the other hand, can draw up a contract, explain its terms to you in detail, and give you all the legal counsel you might—and will—need as you go through the process of selling your home.

How to save money when buying a house?

Buying a home directly with the listing agent is a great strategy to save money. Another great strategy is to diversify your investments through real estate crowdfunding.

Why don't real estate agents represent both sellers and buyers?

The conflict is the main reason why some real estate agents won’t represent both seller and buyer. Not only do they feel conflicted, they don’t have the experience to manage both sides of the trade. I once tried to buy a property directly with the listing agent. It was a mother / son team.

Why do sellers pay half commission?

Not only is the seller agreeing to pay half the commission, the seller is also paying half the commission on a lower selling price. Finally, the seller may be more comfortable with the first buyer because the listing agent has gotten to know the first buyer better. People do business with people they trust most.

What does a listing agent need to do?

A listing agent needs to meet the seller and pitch their expertise, marketing game plan, and likely selling price. There might be multiple pitches over many months before finally winning the listing. For the seller, so much is at stake, which is why the vetting process is more thorough than finding a buyer’s agent.

What is the full savings potential for the buyer?

The full savings potential for the buyer is the buyer’s agent commission plus any downward price negotiation. However, you can always negotiate a smaller commission discount where the seller also benefits.

How much does a listing agent get paid?

The listing agent will still get paid his same 2.5% no matter what. There are many ways to negotiate how the buyer’s agent commission can get split up. You can even squeeze the listing agent’s commission in a buyer’s market.

Why do you need a listing agent?

The listing agent can provide better guidance on submitting a winning offer because he sees the other offers. Without the buyer’s agent in the way, communication flow is streamlined.

What Does a Real Estate Lawyer Do?

A real estate lawyer is licensed to practice law and specializes in real estate transactions. A real estate lawyer is familiar with all aspects of the home purchase process and can represent buyers, sellers or lenders.

When Would I Need a Real Estate Lawyer?

There are several situations in which a real estate attorney can be helpful in the home-buying and selling process, from reviewing the purchase contract in a typical sale to dealing with a uniquely complicated one.

How to Find a Real Estate Attorney

Recommendations from people you trust, such as real estate agents and lenders, can be a good place to start when you’re looking for a real estate lawyer. You also can search for real estate lawyers in your area, check with the local American Bar Association chapter or contact a non-profit organization that helps homeowners. You’ll likely want to interview at least a couple of lawyers so you can compare their approach, rates and availability..

Why You Should Hire a Real Estate Attorney

Some common examples of when hiring a real estate lawyer makes sense include:

Who gets the commission from a realtor?

The seller has an agreement with his realtor on what commission is paid, the agent would get the whole commission. Usually, sellers with agents have anyone that contacts them go through their agent.

Do you give 6% to a seller?

yes you would be giving the sellers agent the 6%. They have an agreement to work out financials and you're not really part of it. Also as a buyer your agent is basically free so it's really a waste of your own money to hire an attorney to draw up papers your agent would do for you being paid by someone else. It's not a big deal if you use an agent or not. Our forms in Sioux Falls are already attorney written and are standard. (I'm a local realtor).

Why do you need a real estate agent?

One of the best reasons to hire a real estate agent is that the sellers are likely to use their own agent— and you want to keep that agent from taking over the process. In fact, the seller's agent might pressure you to let him or her represent both seller and buyer, in a " dual agency " relationship that primarily benefits the seller.

What do experienced real estate agents do?

What's more, experienced agents usually have contacts with good inspectors, mortgage loan brokers, and others who can make your buying process easier. And they know what's considered appropriate behavior and practice in your geographical area.

How much commission does a seller pay?

The seller typically pays the commission to both the seller's agent and your agent—usually around 5% of the sales price, to be split between the two agents. This percentage isn't cast in stone, however. For example, the seller might negotiate the percentage down if the house is particularly expensive. (And in probate sales, the court sets the commission.) Some buyers' agents have even been known to offer the buyer a percentage of their commission at closing.

How much does an attorney charge per hour?

Attorneys normally charge by the hour, at rates ranging from $100 to $500. You might also find attorneys who charge flat fees for specific services, such as preparing real estate closing documents.

How to get through the process of buying a house?

The process of buying a house is complex, and most people find it's easiest to get through with an agent by their side. Paperwork will be flying around like a small tornado, and it can be helpful to have someone familiar with the process to deal with it. Other parts of the transaction will be happening quickly too—hiring inspectors, negotiating over who pays for needed repairs, keeping up good relations with the sellers (through their agent) and more.

Who wrote Nolo's Essential Guide to Buying Your First Home?

To learn more about working with agents and attorneys to bring about a smooth, affordable house purchase, see Nolo's Essential Guide to Buying Your First Home, by Ilona Bray, Ann O'Connell, and Marcia Stewart.

Can a real estate agent answer a legal question?

However, legal issues might arise that your real estate agent can't answer. In that case, you'll need an attorney's help. Although good agents know a lot about the negotiating and contracting part of the process, they can't make judgments on legal questions. For example, what if your prospective new home has an illegal in-law unit ...

Risks to Consider and Tips Before You Buy

Elizabeth Weintraub is a nationally recognized expert in real estate, titles, and escrow. She is a licensed Realtor and broker with more than 40 years of experience in titles and escrow. Her expertise has appeared in the New York Times, Washington Post, CBS Evening News, and HGTV's House Hunters.

How Does Buying a House Without a Realtor Work?

When buying a house without a realtor, follow the same steps that you would take with a realtor. The main difference is that you are responsible for each step yourself.

Should You Buy a House Without a Realtor?

For some people, buying a house without a realtor could be a cost-effective choice. You may be able to buy a house without a realtor if:

Tips for Homebuying Without an Agent

Before proceeding to buy a home directly from an owner, ask the seller whether you can let your agent represent you. The seller might be willing to pay a commission for a buyer's agent, which means that your agent would cost you nothing.

Risks of Shopping Without a Realtor

Note that some homebuyers, especially first-time homebuyers, are wary of real estate agents. They think that real estate agents care only about closing the deal and not about them.

The Bottom Line

Before buying a home without a realtor, you should consider ways to protect yourself from risks that can be costly. Using a buyer's agent and hiring a real estate lawyer to answer questions and review contracts can minimize the financial risks you take when buying a home.

How hard is it to buy a house without a realtor?

The ease with which you can buy a house without a realtor depends on your experience in real estate and the time you have to navigate aspects of the transaction your agent would normally handle.

How to avoid hiring a real estate agent when selling a house?

1. You’re Related to the Seller. If you are selling a home within your family, you might be able to avoid hiring a real estate agent. In that case–as long as you have agreed on a price and other key details of the transaction–you likely could handle it without the seller paying several thousand dollars in commission.

How to get a discounted price from a real estate agent?

If the seller is working with an agent, you could ask the seller if they’d be willing to give you a discounted price since the seller won’t have to pay commission to a buyer’s agent.

How to be a serious bidder for a home?

If you want to be a serious bidder for a home, you need to lock down your finances so the seller knows you’re ready to buy. Preapproval involves more paperwork than prequalification, but it’s the strongest assurance you can get from a lender that you’re ready for a mortgage. Hire a real estate attorney.

What are the services a real estate agent can provide?

However, there are more many services a real estate agent can provide than just “knowing the market,” such as helping you find the home and negotiating with the seller’s agent. 3. You Can Save Money. There are rare cases in which a buyer might have to pay all or part of a buyer’s agent’s commission.

What to do after a home inspection?

After the inspection, you or your lawyer will need to negotiate with the seller on what needs to be fixed before closing. Finalize the purchase. Some states require that you have legal representation at closing, but it’s a good idea even if it’s not the law.

How to get the best deal on a home?

Even if you’re buying a home from a family member or a newly built home from a builder, you need to review the sale prices for other, similar homes in the area to make sure you’re getting the best deal. If you are casting a wider net, you could focus on just “for sale by owner” homes that might not involve an agent.

What to do if you have a background in real estate?

Unless you have an extensive background in real estate purchases, you are likely to be overwhelmed by the paperwork, which can include offer letters, title records, bill of sale and disclosure statements.

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.

How much are real estate attorney fees and costs?

Real estate attorneys usually cost $150–350 per hour, and bill by the tenth of an hour. So, you could pay $15–35 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.

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 ​​American Bar Association, FindLaw, or other professional organizations, like your state’s bar association.

FAQs about real estate lawyers

Real estate attorneys cost $150–350 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.