Engaging the right attorney helps you avoid costly mistakes in real estate deals. Especially if you start working with the attorney before things go wrong. There are several types of attorneys you may want to engage, depending on what you’re buying and what you want to do with the property.
Here are a few situations where you may benefit from the help of an attorney -- and the type of attorney you should look for.
Contract development and execution
Your real estate agent’s standard contract is usually good enough to complete a single-family home sale. But commercial deals are more complicated.
They require more contractual stipulations, contingencies, and may involve partnerships or 1031 exchanges. In this case, it makes sense to engage an experienced real estate attorney.
He or she can help you put together a contract with several outs in case the deal doesn't meet your requirements. If you have an out, you can rescind your offer without the possibility of a legal dispute. An attorney can also help you negotiate through the process and avoid disputes.
Attorneys for these types of services charge by the hour and can run from $307 to $615, according to the Justice Department’s Laffey Matrix. It depends on your attorney's level of experience and the market you're in.
You can also use a standard contract or put one together yourself and pay an attorney to review it. This may cost just a few hundred dollars.
If you’re in doubt, many lawyers offer free consultations. Use one to talk through service offerings and get an estimate.
If you plan to buy or sell a multifamily, retail, office, industrial, land, or mixed-use property, you may want to engage a land use or real estate attorney to help you conduct due diligence.
A land use attorney will tell you what's legally possible to do with the piece of property you're buying. They'll know the details of zoning, permitting, and restrictions. This can be critically important for raw land that could have building restrictions you don’t know about. For commercial properties, they'll know about tenant restrictions in zoning regulations.
If your project requires a special variance, exception, or change in use, a land use attorney can facilitate that process for you. Doing so can be extremely cumbersome for non-experts.
If you’re buying an apartment building, a general real estate lawyer can help you collect and evaluate information from the seller. This includes things like:
- tenant Estoppel certificates;
- copies of bank records, utility bills, and tenant payments; and
- service and maintenance records.
The costs for these attorneys vary. In large markets, they could top $600 per hour. When interviewing attorneys, ask them about challenging projects they’ve worked on. Ask what the outcomes were, too. And get an estimate of how much the total project or process will cost.