I’ve got two pieces of good news for you:

1. Our course covers everything you need to know to sell your home on your own and save thousands of dollars in the process, and
2. As an attorney, I can easily answer this question.

Why a Real Estate Attorney is a Good Idea When Selling Your Home

Especially today where it’s very easy to list and sell your own home (especially with the right guidance), most home sellers look for professional help because of the complexity and legal significance of the real estate transaction.

Effectively, home sellers could use someone to hold their hand and give them some legal guidance through the process to make sure all the disclosures, contracts, legal forms, etc.

If that’s you, you should get a real estate lawyer and NOT a real estate agent. 

Why?

Quite simply, real estate agents are not allowed to give legal advice! Despite this prohibition against realtors giving legal advice, far too often they try to give it anyway.

This should matter both to prospective buyers and sellers because if the advice ends up being wrong, perhaps because the realtor was a little over-confident and doesn’t really understand the nuances of the law, then when there’s a contract dispute or a legal issue, you’re going to be the one left dealing with the problem.

Sure, if you get bad advice and end up getting sued because your realtor pretended to be a legal expert, you could go after the realtor later in another legal dispute because they gave you bad advice, but that sounds like MUCH more hassle than just doing things properly in the first place and avoiding all of the legal hassle.

If you use a real estate attorney, you’re getting actual legal advice and, if they make a mistake, you’ll be covered because any properly licensed attorney carries insurance to cover mistakes like this.

Real Estate Agent Cost

Real estate agents are ABSURDLY expensive for the work that they do.

You should expect to pay around 6% of the final sale price of your home to agents in exchange for them completing a few hours of work.

If you’d like to see how much you’d lose to agents out of your hard-earned equity in your home, check out our commission calculator.

On a $1 million home sale, the seller would be losing $60,000.00.

Real Estate Attorney Cost

Real estate attorney fees are almost always significantly lower than real estate agent fees. 

For example, even a really expensive attorney that charges $500 per hour, will only end up costing you $2,250 in legal fees after four and a half hours of work (a common amount of time per transaction).

This is an important point to note: a legal expert, and actual attorney who knows real estate law, is significantly less expensive than your neighbor who also happens to be a real estate agent. That alone should show how over-priced realtors are.

Some lawyers may even work off of a flat fee instead of an hourly rate – this can be even nicer (but sometimes more expensive) because you know exactly what to expect for your costs in the transaction.

Attorney VS Agent – Which is best?

This is hard to answer because they do two completely different things.

Agents list your home online for you, schedules the photographer to take pictures, and answers the phone when people call with questions about your home.

Real estate attorneys can help you with the purchase contract, negotiations, legal disclosures, closing documents, and any other legal document.

If you need help with the listing of your home and the marketing of it, either hire an agent for 6% of the value of your home or take our online course and do it yourself. 

If you need help with the legal aspect, please hire an actual attorney.

The post Is a Real Estate Attorney Cheaper than a Realtor? appeared first on Home Solo.

Worry not!

I’m going to walk you through some of the things to consider when you are thinking about drafting your own purchase contract / purchase agreement.

I’m an attorney and I’ve sold multiple homes on my own (FSBO – For Sale By Owner) and I’ve sold some homes with a realtor, too – so, I know how the process works both ways. But, without knowing your specific situation, I can’t possibly give you legal advice (and neither can a real estate agent  – finding an hiring a real estate attorney may be the right answer in your situation.

Contract Basics

Let’s start with the basics – what is a contract? A contract is, at its simplest level, nothing more than an agreement where both (or more) parties involved receive a benefit.

This concept of each side of a contract receiving a benefit is called “consideration.”

Technically, there isn’t really a difference between a written contract or “oral contract.” If there’s an agreement where there is consideration for both sides, then there’s a contract.

The reason written contracts are preferred is because it’s easier to confirm the terms that were agreed upon.

For example, in a real estate transaction, the purchase agreement will involve one party (seller) receiving money and the other party (buyer) receiving a house.

Even if this was written on the back of a napkin, both parties received something (consideration) and there was an agreement. Therefore, it’s a contract.

However, if someone drafted up something on paper that said you have to give them $1 million, made it look like an official legal document, had you sign it, and even had it notarized, it is NOT a contract because you didn’t receive a benefit.

Real Estate Contracts

Real estate contracts are purchase agreements for a buyer to purchase a home from a seller – they are the main legal document that governs the sale process of a home.

In most states, real estate agents have contract form templates that they use for all of their listings. These templates have sections where the relevant information can then be filled in by the buyer’s agent and presented to the seller as an offer.

If the offer is accepted by the buyer, then a valid purchase agreement (legal contract) exists.

The use of a standard contract not only makes an agent’s job easy, it also has been made to conform to the real estate laws of that particular state and ensures that the most common elements are included.

In a FSBO transaction (For Sale By Owner), the seller isn’t using an agent and won’t have access to the standard contract used by realtors in their state (this is just one of the many ways real estate agents try to force people to use them instead, and give up a lot of their money, instead of handling the sale on their own like they might for a used car).

However, since they buyer’s agent is the one that submits the contract as an offer to be considered by the seller, this isn’t usually an issue. However, if the buyer doesn’t have a realtor, the two parties may be working together to draft an agreement that works for both of them.

Because this is such an important part of the home-sale process, we have an entire chapter of the Home Solo online coursededicated to working with for sale by owner contracts.

Common Elements of a Real Estate Purchase Contract

There are some elements that will be a part of every good home purchase agreement:

Buyer / Seller – Both the buyer and seller (whether individuals or corporations/trusts) will be identified by their full legal names.

Property description – The contract should clearly identify the property that is being sold. This includes the property address and the information about the land (like plot number from the deed).

Purchase Price – The offered purchase price will be a part of the legal agreement and this might be modified as part of negotiations. This will also include how the payment will be made (e.g. cash or financing) and how much of a deposit will be made.

Title Company – The title company should be identified along with the escrow agent which will be holding any deposit (sometimes called “earnest money”).

Seller Disclosure – Although not usually in the actual legal agreement, the seller’s property condition disclosure statement, should be referenced. Sellers, be careful on this one – you have a legal and ethical obligation to disclose all things about the property for which the buyer should be aware.

FSBO Contract FAQ

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