Review and Comment on
Residential Real Estate Contracts
Explanation and Engagement Letter
POLICIES FOR REVIEW/COMMENT
TREC and TXR Contracts. Texas Real Estate Commission (TREC) and Texas Realtors (TXR) contracts are commonly used in Texas residential real estate transactions. They are, however, optional for non-licensed persons. The only ones required to use these forms are agents and brokers. Buyers and sellers are free to negotiate and modify TREC and TXR forms and include special provisions. Our review/comment process is available only for TREC and TXR forms.
Real Estate Contract Review/Comment. A review/comment consultation is available for earnest money contracts and addenda so long as they are unsigned and completed on a TREC or TXR form (custom contracts excluded). Our method is to go through the document and make comments and recommendations item-by-item.
Contracts that are Already Signed. If the contract is already signed, the opportunity to negotiate changes, improvements, or special provisions has likely been lost. Accordingly, our comments will be limited to explaining what the client has already signed rather than focusing on changes or amendments. At our discretion, we may choose to decline cases where the contract is already signed.
Review/Comment is Not Full Representation. Review/comment is a stand-alone one-time legal consultation. It is not full representation in the entire transaction from contract through closing.
Special Provisions Addendum. A Special Provisions Addendum (containing clauses favorable to buyer or seller) is highly recommended. Fees are an additional $150. Note that if the transaction is complex, or if the client has extensive questions, then the client should anticipate that the consultation may go beyond one hour and be prepared for the extra fees. All fees quoted are guidelines subject to an exception in complex or document-heavy matters.
Getting Started. The client’s best first step is for the client to attempt to fill out the contract (for example, TREC 1-4 Family Residential Contract, in order to get basic information and terms on paper. The TREC contract is available free on the TREC website.
Advising Only One Party. Our role as a real estate attorney is strictly limited to advising or representing one party. We never “represent both sides” although we are often asked to do so. We must know exactly who our client is (buyer, seller, or broker). Although we may have discussions with other parties, we advise and represent only the one client.
DIY and Internet Contracts not on TREC or TXR Forms. We do not review homegrown or Internet-sourced real estate contracts. These do not meet our professional standards and need to be replaced, not merely “reviewed.”
Existing Homes Only. We do not review new residential construction contracts. These are usually non-negotiable by the builders except for price and other deal points. Attempting to negotiate legal terms with builders is usually futile. We may, however, be available for a possible commission rebate arrangement.
Use a Title Company for Escrow, Title Work, and Closings. This office is not a title company. We offer legal counsel, document preparation, and representation services only. We do not conduct in-office closings, escrow and distribute funds, or offer title insurance. An established title company is recommended for these services.
Letters of Intent. If you have not yet reached full agreement on the transaction terms, consider starting with a non-binding letter of intent (LOI) to establish basic terms. These are more often used in commercial transactions but can also be a useful first step in a residential transaction, particularly if is complex or a creative approach is being used (e.g., a wraparound, owner finance, subject to, etc.).
CONSULTATION PROCESS
Online Consultations for New Clients. All initial consultations with new clients are now handled online, not in the office. An online consultation consists of an hour of attorney time and is intended to substitute for the time one would spend with an attorney in his or her physical law office. Time past the introductory hour is available at our $450 hourly rate.
Duration. The introductory consultation may last up to one hour spread over a period not to exceed 3 consecutive business days (business hours apply) when it automatically concludes. Note please that this is not an unlimited three-day consultation. One hour is the limit.
Pre-Conditions and Guarantees. Other than stating that the matter is within our area of practice, we do not agree to any pre-conditions or provide any assurances as to the outcome of a consultation.
Scope of Work. It is important to be realistic and reasonable about the quantity and scope of material that will be discussed in the introductory hour. Not every legal problem can be analyzed and solved in a one-hour consultation.
Established Online Process. We have an established process for online consults based on working with over a thousand online clients:
(1) be sure that we have told you that we are available to consult on the legal matter you wish to discuss (we may have already made this clear in our response);
(2) read, sign, and return this consultation engagement letter;
(3) make advance payment of the quoted fee on the payment page of the website;
(4) supply background and context, copies of relevant documents (Note that the time it takes for the attorney to read client messages and background documents is included in the hour);
(5) provide a list of any specific questions you have.
Initial Exchange by Email. Our goal is to first gain a basic understanding of the facts of the case (and documentation) before answering questions. We always begin with an email exchange/discussion so we can gather basic facts and documents before answering questions. An optional call is available so long as time remains within the allotted hour. We do not jump straight to a phone call without first gathering basic facts and documents.
Our Response Time. No scheduling or fixed appointment time is required to begin. We will respond promptly although this can vary somewhat due to our backlog and the complexity of your inquiry. We try to be flexible and reasonable and ask that you please do the same.
Automatic Conclusion. The consultation (document analysis, email exchange and optional call) automatically concludes (without notice or consent) after 1 hour or 3 business days of payment whichever occurs first.
Acceptance of Cases. We are a small and specialized law firm and regret that we cannot accept every case. Providing an initial consultation does not obligate our firm to continue handling the matter going forward.
LEGAL VERSUS REALTOR SERVICES
A Lawyer Does NOT Replace a Realtor. Although this law firm offers real estate contract and document-related legal services, and our attorney has a broker’s license, it is important to understand that consulting an attorney is not a substitute for a real estate agent or broker. Hiring a lawyer is NOT a way to obtain full brokerage services without paying a real estate commission. One cannot get these same services by paying a low flat fee to a real estate lawyer.
Our Attorney Also has a Real Estate Broker’s License. Our attorney is a licensed Texas real estate broker. However, this office is primarily a law firm and the services we provide are legal in nature. Any brokerage representation by us requires a signed written agreement in advance. We entirely disclaim any suggestion that our attorney is acting as a real estate broker for anyone unless that person has a signed written agreement with us to that effect.
Information on Brokerage Services (IABS). TREC rules require us to direct you to TREC’s Information about Brokerage Services at https://lonestarlandlaw.com/wp-content/uploads/2020/04/IABS-1-0.pdf.
Brokers’ Commissions. Compensating the buyer’s representative is now an optional and negotiable choice on the part of the seller. A seller is no longer required to pay the buyer’s agent’s commission. It is a matter of agreement and contract between the parties.
Possible Commission Rebate. Because our attorney has a broker’s license, a partial commission rebate (net after taxes) may be available to buyers at closing but only if you use our firm for the entire transaction and you are not already represented by an agent or broker. In such cases, our fee guideline is 1/3 of the total subject to a 1% minimum. A post-closing check is written to the client (net after taxes). The gross commission is assumed to be the customary 3% per side. These are guidelines and may be varied at our discretion. Make no assumptions in this area. We will need to discuss, review, and approve the specifics before committing to any particular arrangement.
POLICIES RELATING TO LEGAL FEES
Advance Payment is Required. We do not send bills after the fact.
Flat Fee System. A consultation is a stand-alone value-added legal service rendered for a flat fee. It does not include other legal services. All such services are separate items in a flat-fee system. Multiple diverse topics may not be bundled under one consultation fee. If this is not satisfactory, consider an hourly retainer.
No Accounting for Flat Fees. Flat fees are not held in trust or escrow. No hourly accounting is ever kept or made in flat-fee matters and the client has no right to demand one. Multiple diverse tasks incur separate flat fees. Costs, if any, are not included. Flat fees are always quoted as “plus costs” if any.
Flat-Fee quotes are Good for 3 Business Days. They then automatically expire without necessity for notice to anyone. This includes statements sent as estimates for legal services. After the three-day period, quoted fees may change.
Refunds. If it is determined very early in the process (before substantial attorney time is expended) that your legal matter is not within our area of practice, we will promptly provide a full refund by means of: (1) an immediate Paypal refund or (2) a law firm check sent by U.S. Mail. However, there is no refund once the attorney expends time and effort examining a file and discussing it with the client. Reading client documents and answering questions consumes time. Once this occurs, a consultation has occurred (value has been provided to the client), and payment for the consultation is non-refundable.
Unfavorable Legal Advice. There is no refund if the legal advice we provide is unfavorable to the client or we (at our discretion) decline to handle the case after the consultation is completed. A consultation is not an advance commitment on our part to handle the case going forward.
Consultations Not Credited to Future Services. Consultations are stand-alone value-added services. Attorney time has been expended and benefit has been provided, so fees paid have been fully earned. Accordingly, consult fees are not applied as credits toward future legal services.
Hourly Billing as an Alternative to Flat Fees. Our hourly rate is $450 with a one-hour minimum.
Expiration of Flat Fees. All payments, retainers, overpayments, or credits to a client´s account must be used within six months or they automatically expire fully and in their entirety, without exception.
LIMITATIONS ON THE CONSULTATION
Review/Comment Versus a Total Re-Write. The flat-fee review and comment process offers only that: review and comment. An introductory consultation fee is not a flat fee for the total re-write of a legal document.
No Review of DIY, Internet, or Junk Documents. We offer review/comment on documents (including TREC and TXR real estate contracts so long as they are unsigned and filled in) or on legal documents that have been prepared a lawyer or real estate broker. We do not review homegrown documents, forms from the Internet, or real estate guru seminar junk. These cannot be fixed by a “review.” To meet professional legal standards, they must be replaced, thus fees will be higher than for an intro consultation.
Complex or Document-Heavy Matters. These types of cases are usually unsuitable for an introductory one-hour consult. Legal advice and services for complex cases will, at our discretion, incur our usual $450 hourly rate from the outset.
Real Estate Contracts That are Already Signed. The contract controls the transaction, the rights and remedies of the parties, any special requirements, the conditions of closing, and the content of the closing documents. If the contract is already signed, the opportunity to affect these issues or to add beneficial provisions has likely been lost. Accordingly, if we review such a contract, our comments are (by necessity) limited to explaining what the client has already signed rather than focusing on changes or negotiating points. We may decline to offer a consultation or other service in cases where the contract is already signed.
Limited Liability in Real Estate Consultations. In the case of limited services (e.g., a consultation that does not include full representation in the entire transaction) the client agrees that our law firm shall have NO professional liability whatsoever for portions of the transaction not handled or advised upon by us.
No Texting Please. We do not offer consultations or any other legal services by text. While texting may be suitable for casual communications, texting of sentence fragments and one-liners is not suitable for a nuanced legal case. Please use a keyboard device and take your time.
No Group Consults Please. We do not offer group consultations with multiple persons at different email addresses. Group discussions may work in a law office conference room but they quickly become chaotic and unproductive by email. We work with one client (or married couple) at one email address.
No Consults on Behalf of Third Parties. We occasionally receive inquiries from persons who are asking about the legal situation of another. For liability/confidentiality reasons, our policy is to deal directly with the actual client and not through an intermediary.
No Guarantees. We cannot guarantee that a consultation will offer a remedy for your legal issue, nor can we guarantee that our guidance will be what you want to hear.
Client ID. The requirement of government-issued photo ID is now common at law firms, medical offices, and other professional firms everywhere. Fraud is rampant. We do not work with anyone who declines to provide ID.
DOCUMENT TRANSMISSION
Supporting Documents. Please provide legible and relevant copies of supporting documents in easily downloadable form. Please scan/email in the usual manner, each as a single document and a separate attachment, and NOT as multiple individual pages or separate jpegs.
Email Attachments. Email attachments should be in pdf, Word, WordPerfect, Excel, or other common software. Please do not send documents in the physical mail. Avoid Dropbox or any method that requires us to get a password and enter a third-party site in order to gain access to your documents. Do NOT apply any form of encryption.
Data Dumps. Send us only the information or documentation that we request. Dozens or hundreds of extra and unnecessary pages make your file much more cumbersome and time-consuming for us to download, read, and manage. We rely on you to screen out irrelevant material. The time it takes to sort through large data dumps of irrelevant material is docked against your allotted hour.
GENERAL TERMS OF SERVICE
Terms of Service. All of our firm’s general terms of service (transparently posted on the website) apply without exception to all persons receiving legal services from this firm.
Business Hours, Weekends, and Holidays. We take business hours seriously. We are not Amazon. Traditional business hours apply (Monday through Friday, 8-5 CST) subject to our posted vacation schedule. By special request, it is possible that certain services may be available during off hours for an additional fee of 20%.
After-Hours Emails. After-hours, weekend, and holiday communications are discouraged and we have absolutely no obligation to respond to same during off hours. Such emails are viewed by us as being received on the next regular traditional business day.
Engagement Letter. This document is an engagement letter setting out the terms and conditions of your consultation. If you wish to proceed, your agreement and signature(s) are required below.
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SIGNATURE DATE
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SIGNATURE DATE