Real estate lawyers are an important part of the home buying process, but as a homebuyer you may not be sure why you need a lawyer involved in the transaction.
Legal fees are a costly portion of your closing costs since hiring a real estate lawyer can cost a new homeowner about $700 to $2,500 on top of their sales price. These fees may also be subject to applicable HST or GST and you may also be responsible to cover related expenses and disbursements for the legal work.
A lawyer is responsible for ensuring all the i’s are dotted and t’s are crossed and all of the paperwork is filed in a real estate transaction.
Real estate lawyers are typically consulted when it comes to signing an offer to purchase since they can clarify any of the terms on the legal contract. Once ownership is transferred to the buyer on closing day, the lawyer will also help handle the mortgage transaction, title registration and ensure that buyers pay the downpayment and other closing costs. Your lawyer is the person who hands you the title deed and the keys for your new property.
Their insight can be especially valuable when it comes to buying a pre-construction building. These purchase agreements can be filled with complex legalese and a real estate lawyer can advise homebuyers about the details of the transaction and how it may affect them. For example, sales incentives may not be what the buyer expected and only the fine print can shed light on the matter. Also, a builder may add additional structural changes to a property, which buyers may be on the hook for these extra costs.
During your house hunt, you should also do some legwork into finding a good real estate lawyer. Ask around for some referrals and these questions will help you narrow down who you’ll want to hire:
- How long have you been practicing? If you’re a first-time homebuyer, having a lawyer who’s familiar with real estate deals and any possible issues that might crop up could give you some much needed peace of mind.
- How many real estate cases have you handled on this topic? Not all real estate transactions are the same and while a lawyer won’t tell you their client’s name without their consent, this can help you determine the lawyer’s experience. The lawyer’s job will also differ on the type of property you buy, whether it’ s a house or a condo, and it’s an added bonus if they’re knowledgeable about the neighbourhood you’re planning to live in.
- What steps need to be taken in my situation? This is a good way to test the lawyer’s knowledge of the real estate industry by positing a scenario. If the lawyer responds in a vague manner, this could be worrisome for your situation.
- How will billing work? Some lawyers will charge by the hour or with a flat fee. Keep in mind that lawyers may tack on additional costs, such as title registration or title insurance, depending on your transaction. Be aware of the potential costs ahead of time, along with what these costs cover ahead of time so you can budget accordingly.
- Who else will be working on the case? Depending on the amount of work needed on your case, lawyers may pass on some of the work to junior attorneys or paralegals to assist them. Don’t be afraid to inquire about this associate’s background and check with the provincial law society’s to ensure that they aren’t facing any issues of professional conduct. All this info will help you decide which lawyer to hire.
Whether you decide to buy the property as an investment or if you decide to live in it, Rebate4U can help you put some money back into your pocket by filing an HST housing rebate claim with the CRA. We strives to provide our clients with the most professional and quality service in obtaining rebates for their new and extensively renovated homes. We are proud to offer our clients the most personal and attentive service, and we make sure that all of our clients are 100% satisfied.