Killer Lawyers!

By
Real Estate Broker/Owner with Global Property Systems Real Estate DOS NYS #10491202606

I can't believe what just happened AGAIN! My second deal to fall through this month because of bad lawyering.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

On both occasions, my sellers insisted on using "their" attorney to handle the transaction, and in both cases, the attorneys were not real estate lawyers. One was an attorney the sellers had used "forever" for things including drawing up their wills and settling their parents' estates. The other was a relative who gave them a "good deal" for drawing up the contract. He was a litigator by specialty but agreed to handle the deal anyway. But because of either inexperience or ignorance of the nature of real estate law on the part of these lawyers, two home sales fell through.

In many states including New York, a lawyer is a regular part of the home buying process. For most, real estate law is all they practice. Most problems arise when buyers or sellers hire the wrong kind of attorney to help settle a real estate deal. Lawyers often specialize in certain areas of law, and the categories range from Admiralty and Adoption Law to Zoning. Real estate law is a form of contract law, but with many nuances not covered under general contract law practice.

For example, in the case of the litigating attorney who worked for my sellers, the deal fell through because he handled the transaction the way he would a lawsuit. Defending litigators commonly protect their clients by dragging out a case for as long as possible, throwing roadblocks in the way of progress wherever possible and blocking communications as much as possible. This lawyer flat-out refused to speak to any realtors involved in the deal. Weeks went by without a contract. Real estate lawyers know that "time is of the essence" in property transactions. Most typically generate a finished contract in a matter of days if not hours. By not using attorneys well versed in real estate law and practices, my two sellers threw away two ready, willing and able buyers.

How real estate attorneys can help
Real estate lawyers' primary function in New York is creating, negotiating, and reviewing the sales contract. But they also can check for compliance with all terms and conditions of the contract, perform title searches to uncover liens or encumbrances on the property, explain any easements or use restrictions, or protect you in the event of a contract dispute at closing. Even in states where it isn't required to hire an attorney for a real estate transaction, it can be a wise thing to do. Things have a way of getting complex in real estate.

Unforeseen circumstances - unpaid taxes that are discovered last minute, hidden property damage or code violations which need fixing, title issues - all can ruin a transaction. If you don't use an attorney and a deal goes awry, you'll still have to hire one, usually at the last minute and for substantially more money. Better to work with a lawyer to structure a contract, rather than save it.

Attorney's can also be especially important should problems arise after transactions are complete. For example, if a basement floods during the new owner's  first rainstorm and the sellers' disclosures never noted the problem, an attorney can work to have the sellers compensate you for damage caused by water and for the cost of a sump pump or whatever else is needed to mitigate the problem.

Fortunately in New York, lawyers are required for a real estate transaction. But unfortunately, some homeowners and buyers don't realize that not all are created equal. Make sure your mouthpiece speaks real estate!

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Rainmaker
5,126,170
Barbara Todaro
RE/MAX Executive Realty - Franklin, MA
Marketing Agent for The Todaro Team

Vanessa....that's ashame....almost sinful to have two transaction fall because of sloppy, inept actions or inactions on the legal end.....

Aug 26, 2014 06:50 AM #1
Ambassador
2,914,013
Anna Banana Kruchten CRB, CRS
Phoenix Property Shoppe - Phoenix, AZ
602-380-4886

Vanessa this makes me very glad that we are what is called 'an attorney if fact' when it comes to writing up contracts.  The only time real estate attorneys - note I said - real estate attorneys - get involved is if I have a question or a sitution comes up where I need legal advice.  I would never consider asking anything other that a real estate attorney for real estate advice.  Sorry these sales went down the drain. That is so counter- productive to giving both parties what they wanted, a sale and a buy.  Big egos involved?

Aug 26, 2014 08:03 AM #2
Rainmaker
257,245
Vanessa Saunders
Global Property Systems Real Estate - White Plains, NY
From Manhattan to the Catskills of New York

Egos and Old Fashioned "I don't deal with Realtors!"

Aug 26, 2014 08:31 AM #3
Ambassador
2,364,510
Fred Griffin, on leave of absence from ActiveRain
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

    Vanessa, I was involved in a sale where the Buyer was a paralegal for a big law firm in Tallahassee.  When I say "big", I am talking about the firm where a certain $750 per hour attorney was influential representing George Bush in the year 2000 Presidential Election.

     The Buyer insisted on using that law firm to close it, since she worked there.  Problem was, they didn't send that $750 per hour attorney to close the deal.  They sent the new guy.  I honestly believe that he had never seen a HUD-1 prior to that Closing.

      Guess who saved the day, while allowing the attorney to save face?  That's right, me!  I would ask leading questions like, "is this the line where the Buyer signs indicating this or that?"   We got through it; the loan was paid off, the Seller got her check, the Buyer got the keys.    

Aug 26, 2014 10:43 AM #4
Rainmaker
420,385
Christopher Pagli
William Raveis Legends Realty Group - Tarrytown, NY
"I Stay Open Until You Close"

NY is ridiculous.  Many attorneys don't have any urgency and let their ego dictate.  I have an amazing attorney that I refer to clients and she is loved by all. I find that NYC attorneys are the worst when it comes to lack of urgency and communication.  Not all of them are bad but enough are.  Have a great day!

Aug 26, 2014 11:08 AM #5
Rainmaker
877,272
Elyse Berman, PA
Best Connections Realty, Inc. - Boca Raton, FL
Boca Raton FL (561) 716-7824 CRS, ABR, GRI,ePR

Vanessa,  I think some people just don't get it.  Hiring the wrong attorney is akin to going to an orthopod when you need a cardiologist.   In Florida, attorneys are not required.  However, I always recommend my clients use one - if not to walk them to closing, then to at least go over their docs.  I am a retired NY court reporter.  In my opinon, buying a home is one of the most expensive purchases they will make in their lifetimes.  This is not the time to be penny wise and dollar foolish.

I'm sorry your deals fell apart due to the attorneys.  

Aug 26, 2014 12:26 PM #6
Rainmaker
1,675,429
Larry Johnston
Broker, Friends & Neighbors Real Estate and Elkhart County Subdivisions, LLC - Elkhart, IN
Broker,Friends & Neighbors Real Estate, Elkhart,IN

Hi Vanessa, You are not alone. Many of the Lawyers think they know it all, but when it comes to Real Estate, We have had a number of them give bad advice and the client either ended up losing the home or the seller losing the sale. In the end, They say,"I'm sure glad I had a lawyer, otherwise I would have made a big mistake." The bad thing is that you can not convince the client otherwise.

Aug 26, 2014 01:33 PM #7
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Rainmaker
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Vanessa Saunders

From Manhattan to the Catskills of New York
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