Why do I need an attorney?
Buying a home is an exciting but often intimidating experience for people, especially for first-time buyers. People have a lot of questions about the process. One question is, “do I need an attorney?”. While the roles of the realtor and bank in a residential real estate transaction are obvious, the role of an attorney may be less so. But in real estate closings, as in all cases, the role of the attorney is to be an advocate for his or her client.
One very important reason to hire an attorney when buying a home has to do with the title insurance. Title insurance is an important step to protecting yourself when you buy real estate. The first step in obtaining title insurance is the performance of a title search. A title search is a review of all matters of record regarding the property you are buying. Buying a property without first doing a title search is dangerous because the property might be subject to a variety of liens that could jeopardize your ownership of the property or your ability to use the property in the way you plan to. For example, your seller might have more than one mortgage on the property and you need to confirm that the purchase price will be sufficient to remove all prior mortgages so that you own the real estate “free and clear” other than for any mortgage you take out against the property. Once the title search is performed, the buyer will be given a title insurance policy.
A title insurance policy protects a buyer against any property disputes. For example, if a week after you purchase the property a stranger appears with a deed for that same property and claims he owns it, the title insurance company would protect your ownership.
Realtors, banks, settlement companies, and attorney’s offices all offer title insurance. In Pennsylvania, the cost of title insurance is set by law and does not vary regardless of whether that insurance is issued by a settlement company, bank or attorney’s office. But when an attorney issues the title insurance, you know that you have had the benefit of an attorney reviewing your title, that means that a skilled practitioner who can pick up on the legal implications of all matters of record has looked at your file.
Having an advocate at your side is also helpful if there are any hiccups. For example, if closing gets delayed or the house is damaged. An experienced attorney has dealt with those issues before and can offer guidance with your protection in mind.
Have an attorney represent you in a real estate settlement gives you the peace of mind that your interests are being looked out for in the transaction. For many people, buying their home is the single largest investment they will make in their lifetime, having an independent advocate by their side through the process is helpful.
CGA Real Estate Department Chair
Rebecca is skilled at negotiating and drafting contracts, including purchase and sale agreements, commercial leases, asset purchase agreements and multi-member operating agreements. She has significant experience in all aspects of real estate transactions.
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