Do you need a real estate attorney to close in Washington?

What the law requires

We found no Washington statute or court rule that makes an attorney mandatory in a home sale. Where the law does set requirements, they concern the escrow function and the unauthorized practice of law.

Escrow. An escrow is a transaction in which documents or money go to a neutral third party who holds them until conditions are met and then delivers them under written instructions (RCW 18.44.011). Acting as an escrow agent for pay without a license is unlawful. The licensing requirement does not apply to (RCW 18.44.021):

• banks, trust companies, savings institutions, credit unions and insurance companies;
• a Washington-licensed lawyer, if the escrow is done as part of a law practice, through a publicly identified law practice, and with funds held in a trust account that follows Supreme Court rules;
• a real estate broker or firm handling its own transaction, only if it receives no compensation for escrow services;
• title insurance companies and licensed title insurance agents.

So a closing in Washington may be run by a licensed escrow company, a title company, a bank or an attorney’s office. The statute does not say which one you must use.

Practice of law. Under General Rule 24, practicing law includes giving legal advice for pay, selecting, drafting or completing legal documents that affect someone’s rights, and negotiating legal rights for someone else. A nonlawyer who practices law commits a gross misdemeanor, and later violations are class C felonies (RCW 2.48.180).

Who may prepare closing documents

The Supreme Court has carved out an exception for limited practice officers (LPOs). Under Admission and Practice Rule 12, an LPO may select, prepare and complete documents on forms the Limited Practice Board has approved, for use in closing a sale or loan. The list covers deeds, promissory notes, deeds of trust, reconveyances, mortgages, satisfactions, real estate excise tax affidavits, bills of sale, powers of attorney and a few others.

The rule limits what an LPO can do:

• All clients must first agree in writing to the basic terms of the deal.
• The LPO must tell the clients in writing that they are not acting as either side’s advocate, that the documents affect their legal rights, that the clients’ interests may differ, that they have a right to their own lawyers, and that the LPO cannot give legal advice on how the documents affect them.
• LPOs must carry proof of financial responsibility.

General Rule 24 also lists the sale of legal forms in any format among the permitted activities. The same rule treats advice about someone’s legal rights, for pay, as the practice of law.

What an attorney costs

No Washington statute, court rule or state agency we read sets or reports a standard fee for a residential closing. Attorneys set their own fees, so ask for a quote or a written fee agreement before you hire. Escrow fees are a separate line, covered in Washington closing costs and in the national guide to closing costs explained.

When an attorney is worth it anyway

The law does not require one, but some situations involve rights that only a lawyer may advise on:

• Foreclosure. A housing counselor or an attorney can refer a borrower to the state’s foreclosure mediation program (RCW 61.24.163). See Washington foreclosure.
• Rescission or disclosure disputes. The 3-business-day rescission right under RCW 64.06.030 requires specific written notice. See Washington seller disclosure.
• Title problems, boundary disputes or easements that show up in the title report. Review title insurance explained.
• Community property and estate issues, for example when a spouse has died or a divorce is pending. See community property in Washington.