Many times we will receive calls from people who found our name on either the internet or through a referral and the first thing they ask is, “What do you charge for a closing?” As a consumer I can somewhat sympathize that buying a home is an expensive proposition, where money can be somewhat tight and every dollar counts. However, cost shouldn’t be the driving factor, especially when legal fees are typically (i) less than one half of a percentage (.05%) of the overall transaction, and (ii) among the cheapest out-of-pocket cost for the entire transaction. Rather having the having things done correctly from contract to closing should be the driving force. This is important because for many people buying or selling a home is the largest transaction they will ever make. While mistakes can happen (as everyone is human) and issues can arise (as in this economic environment, things do not always run smoothly), you need an attorney who is well versed in real estate law and real estate transactions who will protect your interest and explain to you the significance of the documents you are signing.
Other factors a person should consider when choosing an attorney for the sale or purchase of a property, is (i) whether the attorney will get back to you when you call or email him/her and (ii) will you be dealing with the attorney or will you be passed along to his/her staff (e.g., a paralegal). There are many times that we hear from clients, “When I purchased my home I never met or spoke with my attorney prior to closing; I only communicated a few times with his paralegal.” When I asked if they ever reached out directly for the attorney, their response typically was, “Yes, but he never got back to me.” While this makes for a great business model for the attorney (putting a minimal amount of time in on the matter and getting a check at closing), it doesn’t put the client at ease. A person should look for an attorney that is (i) responsive to his/her questions, (ii) helps explain the process as well as they go along, and (iii) explains the documents he/she is signing and the potential impact they can have on the deal. This is important as it allows the person to be informed as to what he/she is getting into, as well as the ramifications of what can happen if he/she or the other party do not comply with the documents or make fraudulent or inaccurate representations.
Again, while cost should be a factor, please note that attorneys often set their rates based on their knowledge and experience. After all when you are looking for a doctor do you look for the one that is the cheapest or do you look for one who is good and can help you. I submit it is generally the latter. Please note that sometimes when attorney’s rates are considerably lower than the norm there is a reason why. As the old adages say, “Be careful what you pay for” and “Cheaper does not mean better.” As such, in light of the fact that purchasing or selling a home is one of the largest transactions a person will make, I submit there are more important factors than costs when choosing an attorney to represent you.
This percentage can change depending on the contract price