Facebook Twitter Pinterest Gmail Q: While speaking with my Realtor, who is listing my home for sale, the topic of the real estate closing came up. In New York, where I’m originally from, it’s typical to use an attorney for real estate closings. My Florida Realtor said an attorney is neither required nor necessary when […]
Q: While speaking with my Realtor, who is listing my home for sale, the topic of the real estate closing came up. In New York, where I’m originally from, it’s typical to use an attorney for real estate closings. My Florida Realtor said an attorney is neither required nor necessary when listing, selling, contracting and closing a property and that attorneys often encumber the negotiation and the closing. Should I use an attorney rather than a title company for closing the sale of my property?
A: Your Realtor is partially correct in that attorneys in Florida are not required for listings, sales, contracts and closings. However, there are substantive benefits in using an attorney for contract preparation, review and management of the real estate title and closing process for both the sellers and buyers.
There are many conflicts that occur in real estate transactions that increase the need for an attorney. Some of the most common conflicts are:
- Conflict over compliance with the contract milestones, including meeting time periods for obtaining financing, inspections or other due diligence matters. Buyers may want to take as long as they can to fulfill the steps required to close without regard to terms in a contract whereas sellers desire the closing date to occur as quickly as possible.
- Also, at the end of these periods, the buyer has an obligation to notify and present the seller with a list of concerns about the property in order to have any final negotiations for lowering the price due to appraised value or if a title search or survey reveals contractor or tax liens, boundary issues or material defects of the property.
Such conflicts can lead to problems or disputes like:
- Buyer misses the deadline or notification date and fails to inform the seller in writing as required by the contract.
- Seller fails to respond timely in writing to buyer’s objections, demands or requests presented by the buyer.
- Seller wants to keep earnest money deposited claiming the buyer failed to perform under the contract.
- Buyer sues seller for return of earnest money.
In Florida, both attorneys and title companies may issue title insurance, but there are significant differences between them. An attorney may provide legal representation throughout the transaction, from contract negotiations through closing. Title companies, brokers or Realtors cannot provide any legal advice. They are limited to preparing contracts and basic form documents that are necessary for closing and issuing title insurance policies.
Realtors working with attorneys, rather than title companies, also benefit because the attorney can assist the Realtor with the contract preparation, answering the client’s legal questions during the contract negotiations and preparing addendums and other relevant documents. Remember, title companies and attorneys strive to assure parties involved that there is a smooth process from contract to closing. However, there is a considerable benefit to having an attorney as your closing agent and on your closing team.