Why a lawyer chosen by the agent or developer may not be on your side, what to watch for with referral fees and one lawyer for both parties, and how to choose an independent one.
Early in almost every purchase abroad someone says: "we work with an excellent lawyer, we can arrange everything". It is convenient, it is quick and it is often well meant. It is also the point at which a buyer who does not know the local system hands the most important check to a person chosen by the other side. This article explains the conflict, what independent guides say about it and how to choose a lawyer who answers only to you. It is general information, not legal advice.
Why agents and developers recommend lawyers
There are honest reasons: they know a lawyer who is responsive, who has handled foreign buyers and who will not slow the file. But there are structural reasons too. The agent and the developer are paid when the deal completes, so they want a lawyer who gets to completion. A lawyer who finds a problem delays the deal, and the agent is the person who loses. Some consumer guides also report that recommended lawyers are sometimes linked to the agent through referral payments. There are no reliable statistics and it is not true everywhere, but it is a reason to ask.
What local sources say
- Cyprus. One guide calls using the developer's in-house lawyer or a conveyancer working for the estate agent one of the biggest mistakes a buyer can make and advises instructing an independent lawyer registered with the Cyprus Bar Association who acts only for the buyer. A Cyprus Mail article, drawn from a law firm, says that one lawyer acting for both buyer and seller is lawful under certain conditions but raises serious questions; the conditions were not available in the text we could read, so ask the local bar.
- Spain. A Spanish law firm writes that many agencies, developers and banks will recommend "their" lawyer, and that this is a problem because that lawyer's interest is to close the deal. Another firm says an agency's "legal cover" often means a lawyer who collaborates with the agency and is appointed and paid by it, not instructed by you. These are law-firm blogs, so read them as informed but interested.
- Greece. Guides say a good lawyer is independent of the seller and the agent, registered with a Greek bar association and experienced with overseas buyers. One source adds that Greek law does not require most buyers to retain independent counsel, which makes it your decision and your risk.
A notary is not your lawyer
Many buyers hear that "the notary checks everything". In many countries the notary is a neutral public official who certifies the deed; they do not represent your interests the way a lawyer does. One Greek guide states that the notary does not carry out a detailed due diligence of ownership and charges. Some agents like the idea that a notary is enough. It is not a safe assumption. See notary or lawyer: who you need abroad and one agent or one lawyer is not enough.
One lawyer for both sides
Where the law allows one lawyer to act for both parties, the lawyer owes duties to two clients with opposite aims, one wanting a high price and few warranties, the other the reverse. If something goes wrong the lawyer has an interest in defending the completed deal. Unless you have a strong reason and a clear written explanation of how the conflict is managed, do not accept it.
Checklist: how to pick an independent lawyer
- Find the lawyer yourself. Use the bar association's directory of the place where the property is, or a recommendation from someone with no stake in the deal.
- Ask directly: do you have any arrangement with this agent, developer or bank, and do you receive or pay referral fees? Ask for the answer in writing.
- Have an engagement letter in which you are the only client, with the scope of work (title, charges, planning and licences, taxes, contract review) and the price.
- Ask for the fee and extra costs in writing. A Greek guide puts typical fees at 1% to 2% of the price plus VAT; use such figures only as a rough comparison.
- Agree that nothing is signed and no deposit is paid until the lawyer has reported on title and permits. See pre-purchase checklist and double sales and hidden debts.
- Make sure the lawyer can read the contract to you in your language. See how to read a purchase contract.
- If you pay through the lawyer, ask where and how the money is held. See wiring a large deposit.
FAQ
Does an independent lawyer cost more? Usually a fee is paid either way; the question is who it protects. A fee of a percent or two is small against the price of a mistake, but compare quotes.
Can I use the agent's lawyer for some tasks? You can, but not for the checks that decide whether you should buy. Give those to the person you chose.
What if I live far away? Many steps can be done by power of attorney and remote signing; see remote signing and closing and power of attorney.
What if the developer insists on its own lawyer? Ask why, and ask your own lawyer to review the documents anyway. A refusal to let you do so is a reason to pause.
Independent help on your side
An independent lawyer you instruct and pay directly, or an adviser who tells you in writing how they are paid, closes the structural gap. D.H. Realting can coordinate independent local lawyers for you; ask any adviser, us included, how they are paid. This text is informational only and is not legal, tax or investment advice.