{"id":126258,"date":"2020-06-16T15:00:00","date_gmt":"2020-06-16T21:00:00","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=126258"},"modified":"2021-03-16T15:00:54","modified_gmt":"2021-03-16T21:00:54","slug":"real-estate-lawsuits-how-to-shut-down","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/real-estate-lawsuits-how-to-shut-down","title":{"rendered":"Lawsuits Are a Big Business\u2014Here&#8217;s How to Shut Them Down"},"content":{"rendered":"<p>As a real estate investor, you have to understand that lawsuits are a business. If someone is looking to sue you, they&#8217;re looking to get your money. A solid asset protection strategy keeps people from finding out what you own. And if they try to sue you, it limits what they can get from you.<\/p>\n<p>A great asset protection strategy exhausts your opponent&#8217;s will and their resources and keeps them from continuing with the lawsuit. In most cases, it stops the lawsuit before it even starts or (at least) encourages the plaintiff to settle early.<\/p>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/oSKSClZCYJ0\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>How Do I Protect My Real Estate Investments?<\/h2>\n<p>You get a proper <a href=\"https:\/\/www.biggerpockets.com\/blog\/asset-protection-in-real-life-how-my-clients-strategy-avoided-a-lawsuit\" target=\"_blank\" rel=\"noopener noreferrer\">asset protection strategy<\/a>.<\/p>\n<p>A proper asset protection strategy <a href=\"https:\/\/www.biggerpockets.com\/blog\/pillars-asset-protection-real-estate-investors\" target=\"_blank\" rel=\"noopener noreferrer\">prevents your assets<\/a> from being seized by somebody via a judgement. It makes people (attorneys) believe they\u2019re not going to get anything out of a lawsuit.<\/p>\n<p>Lawsuits are only paid for in two ways: Either the plaintiff pays an attorney to sue or the attorney takes the case on contingency.<\/p>\n<p><em><strong>Related:<\/strong> <a href=\"https:\/\/www.biggerpockets.com\/blog\/2015-12-04-protect-real-estate-investments\" target=\"_blank\" rel=\"noopener noreferrer\">4 Asset Protection Strategies Every Real Estate Investor Should Consider<\/a><\/em><\/p>\n<p>Let\u2019s say I\u2019m an attorney who wants to sue you. While researching, I find out you\u2019ve qualified for food stamps for the past five years. How much money do you think I\u2019m willing to risk for a judgement which is merely a piece of paper? Without an asset to seize, a judgement is worthless.<\/p>\n<p>If their side researches the real estate investor (you) and finds no assets on paper, no attorney worth his salt is ever going to take a case like that on a contingency. Contingency is free for the client. The attorney risks everything. That&#8217;s why attorneys only file cases that they are very confident they can win and collect on.<\/p>\n<p>So, when you ask yourself, &#8220;How do I protect myself from a lawsuit?&#8221; what you should really be asking yourself is, &#8220;How can I make it seem as if I don&#8217;t own anything?&#8221;<\/p>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/7_B6C3CbBwk\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>Asset Protection: Make Litigation a Nightmare<\/h2>\n<p>If anybody looks to sue you, you want to look like you own nothing. You want to make it impossible for them to try to come after you. One of the ground rules of asset protection is that you need to make litigation a nightmare for them.<\/p>\n<p>And what does a nightmare in litigation mean? It means risking thousands and thousands of dollars with only the smallest hope of being able to get money out of you, the investor.<\/p>\n<p><em><strong>Related:<\/strong> <a href=\"https:\/\/www.biggerpockets.com\/blog\/situations-you-need-real-estate-lawyer\" target=\"_blank\" rel=\"noopener noreferrer\">Buying? Selling? New to the Business? Why You Need a Lawyer Now<\/a><\/em><\/p>\n<p>Now ask yourself, as an investor and as a business person, do you go gamble in Vegas expecting to win big? Probably not, and neither will an attorney asked to take the case on contingency. Most attorneys will take only guaranteed wins.<\/p>\n<p>When we make it a gamble for them to try to come after your money, they just won&#8217;t do it.<\/p>\n<p><a href=\"https:\/\/www.biggerpockets.com\/store\/wealth-magazine-one-year\" target=\"_blank\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-123232 size-full\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2020\/03\/Blog-700x120-v2.jpg\" alt=\"Blog ad for Wealth magazine\" width=\"700\" height=\"120\" title=\"\" srcset=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2020\/03\/Blog-700x120-v2.jpg 700w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2020\/03\/Blog-700x120-v2-300x51.jpg 300w\" sizes=\"auto, (max-width: 700px) 100vw, 700px\" \/><\/a><\/p>\n<p><em>Do you have an asset protection strategy?\u00a0<\/em><\/p>\n<p><strong>Tell us your thoughts in the comments.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>As a real estate investor, you have to understand that lawsuits are a business. If someone is looking to sue you, they&#8217;re looking to get your money. A solid asset protection strategy both keeps people from finding out what you own and limits what they can get from you.<\/p>\n","protected":false},"author":23983,"featured_media":113331,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[4241],"tags":[],"class_list":["post-126258","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate-business-management"],"acf":[],"comment_count":0,"_links":{"self":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/126258","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/users\/23983"}],"replies":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/comments?post=126258"}],"version-history":[{"count":0,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/126258\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media\/113331"}],"wp:attachment":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media?parent=126258"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/categories?post=126258"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/tags?post=126258"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}