Real Estate Agent · Baton Rouge, LA · Member since 2019 · 84 posts · 33 votes
Hello,
A seller and I accepted an offer of 288k on her duplex. It needs a bit of work, but I believe as my second House Hack, it will work out well.
My question is this: Her friend owns a title company, and she would like to go through them to save on costs. Is it recommended to utilize her title company on my end as far as checking the documents and such, or should I use a title company of my own to check my work and run the whole process? I will be doing this without a realtor, so I wasn't sure if using her title company would be detrimental to me, as in they would 'protect' her interests more than mine.
I've heard to hire a real estate attorney for transactions such as this.
What has everyone's experience been with doing an off market deal all on your own... this would be my first, so of course I'm nervous.
Investor · Bethlehem, PA · Member since 2016 · 929 posts · 951 votes
6y
@Brian Mackey I've done both. Gone with the seller's suggested title company, and forced a seller to use a title company I was more comfortable with. For a $288K property and your 2nd deal, it's probably worth hiring your own attorney to review. 1) The costs will be minimal compared to the cost of the purchase + rehab, 2) It will give you peace of mind, 3) the attorney may find something and save you $, and 4) provides you an opportunity to network with a real estate lawyer that you may rely on in the future
Investor/Agent/Entrepreneur · Dallas, TX · Member since 2016 · 464 posts · 564 votes
6y
You could go it alone and use their preferred title company. If they do their job, they will be the ones insuring the title for you, so it's in their best interest for title insurance to bring out any liens & concerns. A title company's core function is a bit more black and white and would be more equal to all parties, the only part is their actual customer service, time to process, and costs that are associated. Also, a real estate agent usually wouldn't really be doing much when it comes to the title work aspect, besides maybe making a few phone calls to them, sitting there with you at closing, and perhaps some advising if there are any liens presented on the title.
I would advise you as the buyer to of course propose your own purchase agreement, you bring in your own inspector, your lender, etc. I don't see a title company making a big difference though, but just check in on their reviews and reputation.
Real Estate Broker · Portland, OR · Member since 2019 · 4k+ posts · 2k+ votes
6y
"Her friend owns a title company, and she would like to go through them to save on costs. Is it recommended to utilize her title company on my end as far as checking the documents"
LA has diff rules from the other states, but in OR the rates for title insurance are set by the state insurance commissioner, so if that's the issue it's not. However, ALWAYS get a full accounting and UNDERSTAND what is going on. If not clear, call title IMMEDIATELY for an explanation.
Title companies are supposed to be Switzerland (ie neutral) in a deal. They handle money and title issues and closing. They can only do what both sides agree to and do NOT provide advice even if they have lawyers on staff.
I guess my one issue is - Does the escrow officer have experience with comm (ie income-producing) properties? The acctng is different from residential.
If it helps, since seller pays for std title (usually) I'll defer to them UNLESS they want an absolutely ignorant escrow officer.
"I've heard to hire a real estate attorney for transactions such as this."
If you haven't done this before, get a RE atty to review/write the PSA and explain it to you. Too many things can go wrong and it's a major deal for you.
Investor/Agent/Entrepreneur · Dallas, TX · Member since 2016 · 464 posts · 564 votes
6y
@Brian Mackey Nice, that's good you have them all lined up, you should be fine! As for an attorney, you could definitely go that route especially if it's your first and will help you be more comfortable.
Personally, I used to do them all myself when I started out and had used a lot of online resources. I'm sure you could find purchase agreement templates approved by your local board of realtors or city, so it encompasses your local laws. Also, instead of spending a bunch to have an attorney "draft" up a purchase agreement where they just simply pull out one of their templates and change a few words, you could pull your own template and have them review it after the seller has reviewed and marked it up with any changes. This way you could get one review of the document instead of the drafting costs as well as all the edits the seller may come back with.
Investor · Bethlehem, PA · Member since 2016 · 929 posts · 951 votes
6y
@Brian Mackey I've done both. Gone with the seller's suggested title company, and forced a seller to use a title company I was more comfortable with. For a $288K property and your 2nd deal, it's probably worth hiring your own attorney to review. 1) The costs will be minimal compared to the cost of the purchase + rehab, 2) It will give you peace of mind, 3) the attorney may find something and save you $, and 4) provides you an opportunity to network with a real estate lawyer that you may rely on in the future