What does the contract you have say? Does it say you will pay for the cost of the deed? The deed is the single most important document you have ever been involved with. Why would you trust someone else (not licensed to practice law) to prepare it for you? It could be several pages of garbage and you wouldn't know. Go see a lawyer. This is a huge transaction with massive legal implications. Why would you even think of doing it without competent legal advice?
DISCLAIMER: This is not specific legal advice and does not establish an attorney/client relationship.
I agree with most of Mr. Paxton's reply except for the part where he assumes that you are trusting someone "not licensed to practice law" to prepare the deed. It may be that the seller is a lawyer (in which case there are many ethical issues with his charging you for preparation of the deed in connection with the sale of his own house). It may also be that the seller has engaged his own lawyer to prepare the deed and that you are reimbursing the legal expenses of the seller. There's nothing wrong with that if the proper disclosures have been made to you but Paxton is right, you should have a lawyer prepare the deed (or at least review the deed) who you trust and who is answerable to you. You would be very unwise to invest a significant amount of money without competent legal assistance.
Legal disclaimer: John Bonica is licensed to practice law only in Texas. His response is not legal advice and does not create an attorney/client relationship. The response is only intended to provide general information. The question may not include significant and important facts that would change the response. You should confer with a local attorney for competent legal advice.