I was told getting an attorney for commercial RE deals is a must, but does it still make sense for smaller deals like 5-8 unit apartments?
I'm also interested in this question! I'm currently looking at a 6 unit in the suburbs of Chicago. If I move forward with the property and start the loan process, do I need an attorney?
@Vivian Huang @William Tomp I believe you should have an attorney for any commercial deal. Commercial contracts are very different than residential contracts. They are usually created for a specific deal. Are you familiar with contract language? Are you familiar with the due diligence requirements of a commercial lender?
Ultimately as you get more experienced you may have an attorney you only refer to when you fell the need.
Illinois is 'an attorney state' when it comes to real estate transactions. Many, if not most, other states in the U.S. only use lender's closing agents for the transaction process but not IL. I use Michelle Laiss for my closings. She's excellent.
@William Tomp - How comfortable are you navigating and enforcing contracts? We exclusively use them in NY, but it's because we don't use title companies.
@William Tomp I would at least use an attorney who can facilitate the transaction. Use one that is experienced in closing commercial multifamily deals. They will be able to catch onto things you can't. It's definitely worth it to have them close the transaction. But again they must specialize in this space.
1. Finish your profile and include where you are located. This way people who are familiar with the area could answer about issues specific to where you do business.
2. If you are in an area where an attorney is not required you need to ask three questions.
a. How complicated is the deal?
b. How well do I trust the title company?
c. Am I comfortable with my personal level of knowledge/ignorance.
If the deal is outside of your comfort zone in any of these areas, maybe you need an attorney.
3. If you hire an attorney and they screw up you can sue them.
4. If you don't hire an attorney and you screw up then go sue yourself.
If you need an affordable attorney in you area PM me for some options.
Commercial properties are a different animal from residential. So you're better off hiring an attorney even if it's a small multi.
Thanks for the replies everyone. I ended up buying a couple residential properties instead of small commercial, but now I know to always use an attorney on any commercial deal. Thank you