Do I NEED an attorney for my Illinois real estate closing?
When it comes to buying and selling property, Illinois is considered an "attorney state." Lawyers participate in the real estate sale process as a matter of custom and practice. But there are no laws or ordinances that require a buyer or seller to use one. That said, there are certain things that only a lawyer can do for you. There are also elements of the transaction that only a lawyer should do for you.
Legal advice
Only lawyers can advise buyers or sellers about their legal rights and obligations under the contract. Realtors can negotiate deal terms and fill blanks in on templated form contracts, but that's it. Brokers, loan officers, title company representatives may understand many laws. But only a lawyer can give you advice and guidance on legal issues and implications.
Documentation
Real estate transactions involve a lot of paperwork. Only you, or your lawyer, can prepare much of it. These include:
- Contract addenda
- Deeds
- Notes
- Mortgages
- Powers of attorney
- Affidavits
- Pre -and post-closing possession agreements,
- Escrow agreements
- Tax proration agreements
- Requests to extend contract contingencies
- Contract termination notices
You can prepare this paperwork yourself but first, understand that these documents require precision. Errors here can lead to costly delays, disputes, and lawsuits. A lawyer's expert training and experience can save you money, solve problems, and make for a smoother and easier transaction.
The rules are strict. Realtors cannot add or modify terms on the form contract. Anything more (even writing a few words in the margins) is an unauthorized practice of law. The Illinois Supreme Court made this clear in a 1966 case, Chicago Bar Association v. Quinlan and Tyson.
Unwavering loyalty
Lawyers are bound to act with unwavering loyalty to their clients. Your lawyer is obligated to the highest duties of care, loyalty, good faith, and confidentiality, and must act in your best interests, including care to avoid conflicts of interest. This is known as a "fiduciary duty".
Lawyers offer objective advice, zealous advocacy, and focus on protecting your interests. Everyone else on your team wants the best for you, but lenders, inspectors, and title companies are not your fiduciaries. Depending on circumstances, your broker may or may not be either.
Title insurance
Title insurance assures buyers and their lenders that a property will be conveyed free of unacceptable liens and encumbrances. Title agents complete much of the work necessary to determine a property's insurability based on reviews of public records and search packages prepared from a title plant. Then, the title agent clears the title for the buyer, seller, and lender.
While the Illinois Title Insurance Act allows others to act as "title agents," that role is best suited to "attorney agents," who receive specialized training in property law, title examination, underwriting rules and standards, and clearance matters.
An attorney agent's duties include:
- Obtaining and analyzing the land records associated with the property
- Identifying all encumbrances and clouds on title
- Reporting this information to the title company so that it can generate a title commitment
- Clearing any clouds on title by researching each issue, determining the steps that must be taken to clear the unacceptable item from title, and, as necessary, doing the work involved to get the exception cleared
- Accepting personal and professional liability associated with these core title services
While others may be allowed technically to provide these services, attorneys are best trained and best suited for these tasks.
Real estate closings are all we do. Our firm's exclusive focus is helping people buy and sell homes, condos, and other properties in and around the Chicago area.
Contact us when you are ready to make a move, our firm can help you close with confidence.
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