According to real estate tracking firm Zillow, the U.S. housing market hit an all-time high of nearly 30 trillion dollars in December of 2016. Some 5.8 million homes changes hands that year, representing billions of dollars in transactions. Commercial transactions represent even more.
Most of those exchanges go off without a hitch.
But every once in a while, a routine real estate transaction can hit a legal glitch that creates a complete nightmare for everyone involved.
Click here for more information around paralegal careers in real estate.
In 2013, Mark Zuckerberg, founder of Facebook, discovered that a real estate developer planned to build a house that would overlook his own estate. The developer had an offer for $4.3 million for the property already.
Hoping to preclude this, Zuckerberg contacted the developer and offered a different bid: a little under $2 million, but he would also use his position to introduce the developer to other influential people in Silicon Valley.
This particular provision wasn’t put in writing or fleshed out in any specific detail, however—something an experience real estate paralegal would have insisted on and could easily have drafted—and it turned out the parties didn’t agree on exactly what it meant.
Inevitably, the case ended up in court, and although Zuckerberg ended up not having to pay a dime when the developer eventually settled, the attorneys involved earned a juicy fee for two years of work and Zuckerberg notched yet another set of embarrassing public revelations surrounding his real estate deals.
Paralegals Get Property Rights Right
The legal code governing ownership of real property in the United States can be traced back, with few exceptions, directly to the Norman Conquest of England in 1066, so it’s no surprise that real estate transactions can be pretty complicated. More than 900 years of precedent, additions, and modifications have piled up into some pretty arcane rules around easements, evictions, takings and other evolutions of law to address some unforeseen factor or another governing property ownership.
Real estate paralegals are legal professionals who help lawyers sort out this tangle of rules and restrictions to ensure that land ownership and development deals don’t go south and wind up in court. And if they do end up in court, the same paralegals are there to support attorneys and clients going to trial over property claims.
Like most paralegal positions, paralegals in real estate wind up being keepers of the devilish details. While attorneys look at the big pictures of a transaction or legal claim, it’s down to the paralegals to provide the organizational gristle that keeps everything together.
There are mountains of paperwork involved in most real estate deals and enormous amounts of research go into getting the details correct. Paralegals research and verify subjects such as:
- Chain of title
- Property covenants or restrictions
- Property boundaries
- Zoning restrictions
The Job Duties and Responsibilities of a Real Estate Paralegal
Paralegals can be involved in any type of real estate transaction. As a general matter, they will be expected to:
- Maintain correspondence between all parties of the transaction, including buyers, sellers, title companies, lenders, surveyors, appraisers, etc.
- Ensure all deadlines are met
- Review and plotting legal descriptions of land
- File all necessary documents with the appropriate agencies
- Prepare exhibits and documents for court proceedings
- Schedule meetings
But there are a diverse number of roles that paralegals can fill in the real estate pantheon, each of which have a different focus and set of expertise required.
Large real estate developers frequently employ paralegals directly. These professionals may work with or without a lawyer supervising them as they:
- Review land acquisition deals
- Draft and approve contracts
- Provide boilerplate sales contract language
- Arrange liability protection
To reduce liability exposure, many large developers have taken to forming a separate limited liability corporation for each phase of construction, or sometimes each individual house; forming and maintaining each of these hundreds or thousands of companies is full-time work for some real estate paralegals!
Commercial real estate leases are complicated documents governing the rights and responsibilities of both landlord and tenant. They tend to be unique documents, negotiated in every detail. Conflicts can be expensive propositions.
You can bet that a paralegal was involved in drafting and reviewing those lease documents. Frequently, real estate paralegals are also responsible for helping enforce such agreements, reviewing uses and drafting letters in accordance with required notification boilerplate in the documents to keep everyone on the same page.
Paralegals may also draw up notices of trespass for property boundary violations or design and execute covenants to restrict certain uses of commercial property. They may be in charge of administering leases for large commercial leasing companies, overseeing the entire gamut of tenant relations, from rent collection to maintenance to lease negotiations.
And large companies that are themselves lessees of large amount of property—consider retail or fast food restaurant chains, or cellular companies with towers scattered across the country—employ paralegals to look out for their interests on the tenant side of such transactions.
Sales and Foreclosure
Anytime real property changes hands, a complex chain of events required to comply with federal, state, and local laws is begun. Both parties also undertake a variety of standard, but complex, steps to protect themselves from loss. Paralegals may be involved in this process by:
- Arranging title insurance and clearing titles
- Drawing up and approving loan documents
- Managing closing paperwork and processes
Some paralegals also obtain a real estate license for their jurisdiction to facilitate these sorts of transaction.
Unfortunately, paralegals are also usually involved on the other end of the process, too, when payments are not being made on mortgages. Laws surrounding foreclosure and eviction are very specific and have to be followed closely in order to perform the process with due respect for the rights of all parties.
Well Fargo found out in 2015 how expensive bungling this process could be when the bank was forced to pay over $3 million in damages to a Missouri homeowner it had improperly foreclosed on.
Becoming a Real Estate Paralegal
According to the Robert Half 2017 Salary Guide, real estate is among the top five hottest legal sectors for job growth right now.
Paralegals specializing in this area of law a valuable asset to law firms, banks, government agencies, and title companies.
Real estate career diploma/certificate programs provide an opportunity for aspiring paralegal professionals to receive advanced training in real estate law. These programs typically consist of three or four courses and many can be completed online. Most programs require that students have a degree in paralegal studies and/or related paralegal experience.
Coursework in a paralegal certificate program in real estate law includes:
- Real estate law and concurrent ownership
- Condominiums, time shares, and cooperatives
- Real estate contracts
- Mortgages and real estate finance
- Title examinations and real estate closings
- Nonpossessory interests and landlord/tenant issues
There are also three post-degree certification options open to real estate paralegals, each offering a different specialization related to real estate law.
NALA, the National Association of Legal Assistants, has two dedicated real estate certifications, one in basic principles and the other specific to land use. NALS, the association for legal professionals, also has a dedicated real estate law certification.
Finally, the NFPA (National Federation of Paralegal Associations), recognizes the Advanced Paralegal Institute Foreclosure and Debtor/Creditor law certification, which focuses primarily on foreclosure issues.