Comparing Agents to Attorneys in Real Estate Transactions

Do you know how real estate agents compare to attorneys in regards to what they can do for home sellers or buyers? When selling or buying property, it’s always best to rely on the experts, especially when it comes to legal paperwork, tax documents, and other vital processes.

While some real estate agents have the knowledge to help you complete paperwork instead of a real estate lawyer, these two professionals are not the same.

They provide different services and which one(s) you should hire depends on your specific needs, your own knowledge of real estate — and sometimes, the laws in your state.

Here, we’ll provide an overview of the services each provides, typical costs associated with hiring each type of professional, and how to choose who you ultimately use for selling (or buying) a property.

Attorney vs Real Estate Agent When Selling a Home Real Estate Agents

A real estate agent guides you through the entire process of selling or buying your property. In the case of a listing agent helping to sell your property, their services include determining any repairs needed before listing, your property’s best listing price, marketing, hosting open houses and showings, negotiating with buyers, helping with paperwork, and attending your closing.

Lots of folks wonder what a real estate agent does all day. Trust me, it is a lot!

Your agent is an advocate for you as you navigate the many steps to selling your property. A full-service agent will help you from the moment you decide to sell your property until the final closing date when you hand over the keys to the new owners.

While not technically trained in law, real estate agents are required to have thorough knowledge about the standard closing procedures and accurate completion of the documents that accompany the process.

How much do real estate agents cost?

Agents are paid based on how much your property is sold for — usually 5-6% in total, half of which goes to your listing agent and half to the buyer’s agent. On a $200,000 property, this means you can expect to pay between $10,000-$12,000 in total in real estate commissions unless you opt for a discount agent or a flat fee MLS service.

Real Estate Attorneys

In 21 states, the buyer must bring a real estate attorney to closing. Some states require both buyer and seller to have legal representation. In the remaining states, you can buy or sell a property without legal representation, and a real estate agent will suffice.

Your local agent should be able quickly to tell you the rules for your particular state but currently states that require buyers to bring a real estate lawyer to closing include Alabama, Connecticut, Delaware, Florida, Georgia, Kansas, Kentucky, Maine, Maryland, Massachusetts, Mississippi, New Hampshire, New Jersey, New York, North Dakota, Pennsylvania, Rhode Island, South Carolina, Vermont, Virginia, and West Virginia.

As their title implies, real estate lawyers deal primarily with the legal aspect of the transfer of real estate. They have a great understanding of real estate law and experience in dealing with the many nuances that come along with it.

Real estate attorneys won’t help with the entire process as an agent does, but their work is usually focused on the legal tasks leading up to closing, including zoning and title issues, liens and covenants, and transfer of deeds and titles. These lawyers can also help landlords with compliant rental applications and lease agreements.

Real estate lawyers are particularly helpful when dealing with commercial properties, bankruptcies, foreclosures, or short sales. These are unusual circumstances where a traditional agent might not understand real estate laws that govern the transaction. In these cases, it may be a good idea to hire a real estate lawyer — even if your state doesn’t require one by law.

How much do real estate lawyers cost?

Unlike commission-based agents, most real estate lawyers are paid by the hour — although some do offer a flat fee for common services. Generally, the more complicated your sale, the more you can expect to pay, as it will take your lawyer longer to complete. Most real estate lawyer fees range from $150 to $350 per hour or a flat fee of $500 to $1,500.

In this sense, a real estate lawyer is cheaper than an agent, but only provides legal advice and help with paperwork — not the full service offered by a real estate agent.

The same thing applies to flat fee MLS agents. They don’t provide any services other than entering your home for sale in the multiple listing service. Lots of folks going this route quickly discover there is more to selling a home than just putting it in the MLS.

Is it possible to save some money? Sure, but you need to weigh the pros against the cons to make certain this is the way you want to go.

Risks of going it alone

When you’re doing a for-sale-by-owner, it may be tempting to try to manage the legal aspects of the sale yourself as well, but we’d highly recommend against it. There are a lot of potential risks when completing legal paperwork that you may not fully understand. Even more so if you’re planning on putting tenants in the property later. Doing it wrong could mean even more significant legal issues and risking your investment (or costing you money!)

Even if not required in your state, when you’re selling your own property, you don’t have an agent’s expertise and knowledge to fall back on. By not using a trained real estate professional — whether it be an agent or a lawyer — you open yourself up to future disputes about building codes, zoning permits, issues with the title, or misinterpreted purchase agreements.

These problems could cost you thousands or even tens of thousands of dollars to mitigate, especially when it comes to commercial properties. For this reason, it’s best to use at least one of the two — agents or lawyers — or both when buying or selling a property.

Agents can also help you market the property and list it for the right price, saving you thousands in potential lost net revenue and closing faster. Data from NAR suggests FSBO sales take much longer, and only 7% of all sales are FSBO, which would include sellers who only use a lawyer. For this reason alone, it’s worth interviewing an agent and seeing what they can offer.

Other Valuable Massachusetts Real Estate News Media

Take a look at these additional excellent home buying and selling resources.

  • Should I use a real estate agent – one of the age-old questions that go through the minds of many home sellers is whether or not they should hire an agent or not. The decision is often dictated by the desire to save money. Take a look at some helpful guidance that may make your decision an easier one.
  • How effective is flat fee multiple listing services – are you thinking about using an “entry only” real estate agent? Before doing so, you should analyze the advantages and disadvantages of flat fee MLS. Will you be leaving money on the table or putting a bunch in your pocket?

Luke Babich


About the author: The above article about comparing an attorney to a real estate agent in a home sale was written by Luke Babich. Luke is the CSO of Clever Real Estate, an online platform that connects home buyers and sellers with top-rated agents. He’s also a real estate investor in St. Louis, MO who owns over 22 units at the age of 25 with his co-founder, Ben Mizes.