While the traditional responsibilities of real estate attorneys in New York are well understood, new and evolving consumer protection regulations, including the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Consumer Financial Protection Bureau (CFPB) and the new TILA RESPA Integrated Disclosures (TRID) are forcing attorneys to confront new challenges and presenting new opportunities.

The challenges and opportunities are magnified and complicated by the fact that attorneys in New York already address some of the very consumer protection issues that the new federal, one-size-fits-all, laws and regulations target, creating inherent tension between multiple approaches to the same problem.

Moreover, we are likely only at the mid-point in a major evolution at the federal level, with considerable uncertainty ahead. The landscape will continue to change given the new political leadership at the federal Level. Despite this, attorneys in New York cannot simply wait for the full story to unfold. As a result, this article takes a half-time approach: reviewing the first two quarters and outlining opportunities for attorneys in the second half of this regulatory upheaval.

Role of Attorneys

The central role of the attorney in New York is a product of statute, enhanced and expanded by custom and practice. At the most basic level, New York provides that “[n]o natural person shall receive directly or indirectly, compensation … for preparing deeds, mortgages, assignments, discharges, leases or other instruments affecting real estate … unless he has been regularly admitted to practice, as an attorney or counselor, in the courts of record in the state” (N.Y. Jud. Law §484). There are also prohibitions against voluntary associations or corporations performing the above services, although there are some limited exceptions for title insurance companies. (N.Y. Jud. Law §§495 (3.5)). Certainly, the above list does not represent all of the functions of a real estate attorney in New York, but it does demonstrate how difficult it would be to conduct a closing in the state legally without an attorney.