For Illinois residential real estate closings (buying or selling a home), attorneys typically charge their clients (buyers or sellers) a fixed-fee for the entirety of the representation. It is common for residential real estate closing attorneys to collect their fee only if the closing actually takes place; or a lessor portion if the closing does not take place.
When representing sellers in residential real estate closings, attorneys will often act as title agents as well. Sellers typically deliver a title commitment for a title insurance policy, which covers potential defects/issues with title that may appear after closing. Most of the work preparing the title insurance is done by an agent of the title insurance company. If an attorney is representing you in the sale of your home and is also acting as the title agent, then your attorney is required to disclose this to you and the other party. Attorneys generally collect a portion of the title insurance premium, which sellers and buyers pay to the title agency, for their work as title agents.
For commercial closings, attorneys in Illinois might charge a flat fee or an hourly fee, depending on the Attorney and the transaction. Commercial closings may include more time and resources than a residential transaction.
As a buyer or seller of real estate in Illinois, you are not required by law to have an attorney; however, there are many legal technicalities and issues a trained and experienced attorney may be able to spot, that you may not. In many cases, a real estate purchase may be the first time an individual or couple ever hires a lawyer.
A residential real estate attorney can draft the contract, but the contract is often drafted by the listing or buying broker and signed by the client prior to any discussion with an attorney. After a contract is drafted and signed, an attorney will review the contract and discuss the content of the contract with the client. An attorney can determine if the contract aligns with the client’s understanding and objectives. Based on experience and each client’s unique situation, attorneys propose modifications to the contract during the attorney review period. Attorneys also review modifications proposed the other party (seller/buyer). Common modification requests can include: property tax proration amounts, mortgage contingency deadlines, inspection defects (either to be repaired or a resolved with a credit at closing); and the closing date.
After the review period is complete, attorneys will make sure deadlines are met and proper documents are prepared correctly. This can include mortgage contingencies, pre-closing inspections, surveys, pay-off letters, transfer documents, title commitment documents, transfer tax stamps, and compiling and reviewing closing numbers. At closing the Attorneys will review the closing documents and explain the significance and meaning of the documents to their respective clients. When representing buyers, attorneys walk their clients through complicated mortgage loan documents. Additionally, the Attorneys may resolve disputes that arise at closing.
*Christian is an Illinois business and real estate lawyer and is happy to speak with you and assist with your start-up or small business. Call (773-706-7514) or email (christian@attorneyblume.com)
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