Are Attorneys a Good Source of Mentoring in Real Estate Investing?
Most investors don’t realize the power of a good real estate closing attorney and are usually most concerned with paying the lowest possible fees. The value of a good attorney, not just a closing firm, is that they will keep you out of trouble you don’t even know about it until it is too late. I am not talking about a title company that doesn’t have an attorney because in many states, anyone can become a title agency and issue title insurance without being an attorney. I am talking about an attorney who can legally give you legal advice that you will find invaluable.
The way my career developed was I started by buying a single family home for myself and when I went to the closing I realized that the closing attorney knew less than I did about the closing process. He was a family attorney who did very few closings and I was doing an assumption of the existing loan. There were five additional notes on the property which I had the seller pay. In fact, the seller had to bring money to close and didn’t have enough to pay his realtor’s commission so he had to sign a note with the realtor to close – a personal note, not a mortgage on the property.
I actually took the time to carefully read the closing documents and realized how inept the attorney was and I decided to look into real estate investing ponzi scheme attorney and buy more properties using this newly found “no money” technique I had accidentally discovered. So my first experience was a great start but then came the next 35 years of my career that were even better! I still tell my students and other investors that each and every deal is different. Seldom can a template be made that will cover each and every contingency that can arise in the chain of title or because of buyer or seller remorse.
My experience has been that some of the best mentors for me have been attorneys who I work with in the industry who are actually closing real estate deals. In my case this was probably 10 attorneys over the last 35 years who closed most of my deals. The ones where they did not close the transactions were because the seller or buyer had selected the title agent.
Most attorneys are gracious about giving a consultation. Some gurus will even give you instructions on how to interview these real estate attorneys including getting their fee schedule and negotiating their fees before you do a deal. The fees should be the least of your concerns, being penny wise and pound foolish can cost you many times the meager savings in one deal.
The better option is to have an attorney review your contracting before you give it to your seller or buyer. You only need him to review your contract a couple of times as you can create a template and use it in most contracts. If you find a unique situation where you need something extra added to a contract, call and ask for the exact language from an attorney.
In summary, using an attorney as a mentor on how to do your contracting and closing is the best way to make sure you are absolutely doing the right thing in your investing. However, remember that it is two-way street and if you are not closing deals through him, your source of legal information could disappear. If you take legal information or opinions from non-attorneys you have little or no recourse, however, attorneys have malpractice insurance and their advice is coming from a respected source – choose your attorney carefully as he can become a great source of confidence in your investing career.
Dave Dinkel has over 35 years experience in real estate investing which has given him a unique perspective into the real estate market. Dave is the author of the best-selling e-courses and many other e-courses for investors and homeowners.