Home  Coloradoan Archives  Sr. Voice Archives  FAQs  Links 
Law Offices of Ronald W. Rutz
Coloradoan Archives

November 1, 2000: Selling House without Losing Profits; Water Law Myths

Q: Is it possible to sell my house without having to split my profit with either a realtor or a lawyer?

A: In the states in which I practice, Colorado is the easiest for an owner to sell his or her home and minimize selling expenses.

There are printed real estate forms that the buyer and seller can complete, although it would be wise to hire a lawyer at least to review and to critique the document.

The seller has the duty to provide good title, so today a title policy is given to the buyer, unlike in the recent past when an abstract was brought up to date and then furnished to the buyer. In selecting a title company, the seller should pick one that also will do the sales closing, usually for a total cost of $200 or less which is normally split between the seller and buyer.

If a realtor is not involved in a sale, the title company will require an attorney to submit a letter to it stating that the contract is binding. That way the title company will not be wasting its time making a title search, pulling together the information, and doing the documents for closing.

It would also be wise to have an attorney review the closing documents just to be sure that everything has been properly done. That way you would have peace of mind plus you would not have to pay to have a lawyer to sit through the closing.

The closing agent then records documents, pays necessary and customary bills, and collects and distributes moneys.

Following this procedure, the seller's expenses would be the cost of the title policy and the closing fees (which would be incurred with a realtor anyway), and the attorney expenses of the opinion letter to the realtor and the possible cost of the preparation of deed (the latter again would be a cost anyway). Finally, there would be the optional legal expenses of the contract preparation and/or review and the review of the closing documents.

Thus, depending on what you mean by "splitting the profit with either a lawyer or a realtor," your out of pocket expenses to legally transfer your house can greatly be minimized if you sell your house yourself.

But also remember that a realtor's job is to make that sale, so you can spend your time and energy doing other things.

Q: You lawyers make water matters a rich man's game because of your fees and your ability to be involved in every little facet of the proceedings.

A: One of the many water law myths is that there are more water attorneys in Colorado than any other state.

When I taught this stuff at the college and law school level, I had exact numbers, but in general, even though systems vary from state to state with many being more administrative and less judicial, states such as Montana and Arizona have just as many legal matters involving water as Colorado, with New Mexico not far behind. But for sheer numbers of legal participants and volume, California "swamps" everyone.

But you also need to understand what happens in water court. The system is not driven by attorneys but by science and it often resembles more of an administrative process than a purely legal proceeding even though matters are technically in water court.

The government official who oversees each river basin is not called the division attorney but the division engineer. The primary water "work horse" in the water court process is the water referee, not the water judge, and traditionally has a scientific background, not necessarily a legal one.

In preparing a water transfer or one of the few water matter heard by the water judge, the biggest expenses are normally generated by the engineers, geologists, hydrologists, researchers, etc. (the "experts"), not the attorneys. In fact, the run of the mill water matter goes through water court often without an attorney or with an attorney only tangentially involved as a "form filler outer."

Thus, to paraphrase an old Willie Nelson song, Mamas don't let your babies grow up to be water lawyers let them be engineers and hydrologists and such (if you Mamas want them to get rich in the water law area).

Home  Coloradoan Archives  Sr. Voice Archives  FAQs  Links