If you decide to buy or sell a home in Illinois, you can have both a title company and a real estate attorney working for you. They seem to have similar roles, but that is far from true.
A clear distinction between a real estate attorney vs title company in Illinois will tell you who is responsible for what during your transaction. While a title company takes care of the title, title insurance, and closing, a real estate attorney is responsible for all legal aspects of the deal. It is common practice in many real estate transactions in Illinois to use both.
What Does a Title Company Do?
A title company plays a key role in the home buying process. Its main job is to check the property’s title and help make sure ownership can be transferred. The title company conducts a title search. This search looks at public records to find the property’s owner. It may also reveal liens, unpaid taxes, judgments, or other claims against the home. If a problem is found, the title company may help identify what needs to be done before closing.
Title Search and Title Insurance
Title search is a vital step in any real estate transaction process. Title searches are likely to uncover previous mortgages that were never released, any lien held by the previous owner, or problems with the legal description of the property.
This information is reviewed by the title company, and the company comes up with the title commitment. Title commitment indicates the terms upon which the title insurance policy can be issued. Title insurance covers the buyer and the lender against the loss arising out of title defects.
But title insurance does not provide legal advice. There may be a title problem identified by the title company, but the buyer will have to see an attorney regarding the same.
Closing Coordination by the Title Company
The title company also assists in coordinating the closing. It can coordinate with the buyer, seller, lending institution, realtors, and lawyers to ensure that all the necessary documentation and finances are in order. The title company may assist in preparing the settlement sheet and coordinating the transfer of funds. The title company may also assist in the filing of documents after closing. This process facilitates the transaction from contract to actual transfer of ownership.
What Does a Real Estate Attorney Do?
A real estate attorney focuses on the legal side of the transaction. The attorney’s job is to protect the client’s interests and explain their rights and duties. A residential real estate attorney may review the purchase contract, explain legal terms, negotiate changes, and help resolve disputes. The attorney works for the client. This is an important difference when comparing a real estate attorney vs title company Illinois buyers and sellers may work with.
Contract Review and Legal Advice
Some of the main responsibilities of a real estate lawyer include reviewing the contract. In the case of a sales contract, the document is a legally binding one that outlines the obligations of both parties. A lawyer can review various aspects of the contract, including its terms for prices, closing dates, inspections, financing, repairs, and the earnest money deposit. The lawyer will also inform the party about the consequences of defaulting on the obligations.
Legal Negotiation
A real estate lawyer can assist in negotiating legal terms for their clients. For instance, the buyer might discover that there is a need for repairs on a property during an inspection. The lawyer will help ensure the negotiation of either a repair, credit, or even a change in the terms of the agreement. The seller could also realize that there is an issue with the title that has to be sorted out before the sale. This can be done through the assistance of a real estate lawyer.
Deed Preparation and Lien Resolution
A real estate attorney may prepare or review the deed that transfers ownership. The deed must correctly name the parties and property. Errors can lead to title problems later. An attorney can also help resolve liens and other claims against the property. For example, an old lien may appear during the title search. An attorney can review the issue, contact the right parties, and help find a way to clear the title.
Why Illinois Allows Attorney-Conducted Closings
Illinois allows attorneys to take an active role in real estate closings. An attorney may review legal documents, explain the deal, and help address legal issues that arise before closing. The closing process can vary based on the deal and the professionals involved. However, Illinois buyers and sellers often choose to hire their own attorneys to protect their interests.
Do You Need Both a Title Company and an Attorney?
In many cases, having both is a smart choice. The title company focuses on the property’s title and closing process. The attorney focuses on the client’s legal rights and interests. These roles work well together. For example, a title company may find an old lien during its search. The attorney can help the client understand the legal issue and work toward a solution. The title company can coordinate the closing while the attorney reviews legal documents and protects the client’s interests.
Why Buyers Benefit from an Attorney
Home buyers are making a major financial investment. A buyer’s attorney can review the purchase contract and help with inspection, financing, title, and closing issues.
This can be helpful for first-time buyers or anyone dealing with a complex property issue. An attorney can also help the buyer understand their rights if the deal starts to fall apart.
Why Sellers Benefit from an Attorney
Sellers also face legal risks. A seller’s attorney can review the contract, help with disclosure concerns, and address title problems. The attorney can also help with deed preparation and closing documents. If a dispute develops, having an attorney already involved can make it easier to respond.
Get Legal Support from EJR Law Office
A title company can help with the title search and closing, but your legal rights need personal attention too. At EJR Law Office, we help Illinois buyers and sellers understand their contracts, resolve title and lien issues, and prepare key legal documents. We work with title companies to help keep deals on track while protecting our clients’ interests. If you want legal guidance from contract review to closing, our team is here to help.
