No Attorney Review Period.......

[Sean McKee]

Hello NWI & Chicago Investors!

I've started looking for some investment properties in NWI. When making my first offer, I noticed that there was not an attorney review period in my contract. I asked my agent and she stated that this was not a requirement in Indiana and if I included it, it would severely hamper my search.

I'm not used to this at all. Every single transaction I've done has involved an attorney for both on market and off market deals. One deal would have likely fallen apart without my attorney involved from the beginning because of mistakes I made during the initial offer.

So, naturally I want to include this provision in my contract. What are your thoughts? I'm somewhat aware of the risks involved in not using an attorney at the beginning, but I'm curious on what you are doing.

Thanks! 

[Jay Hinrichs]

Quote from @Kenneth Garrett:

@Sean McKee

Hi Sean, in Illinois the attorneys run the show on real estate closings and attorney review is standard procedure. As you invest out of state it is rare to use attorneys. The title companies handle the closings which typically is an attorney. I’m not sure attorney approval will greatly hamper you closing on a property, but it’s not necessary.

Exactly AS Mr. Garrett points out you have states that are Attorney closing states where the escrow function is done by an attorney office and the attorney is an agent for Title insurance underwriter.  Then you have states were The Escrow/title company maybe owned by one attorney however you have Escrow officers who handle the transactions ( West coast mainly) And the only time the attorney at the title/escrow company would jump in is if there is some sort of dispute or title claim.

In those states like IN if you need your hand held on vanilla SFR type transaction contracts its up to you to hire one.. U dont need to put that in your offer.. Just use the basic Due diligence time line in your contract and during that time line contact a local attorney and ask them to review the contract. Unlike IL were this is part of the closing attornies fee's in this instance the outside attorney is going to want a fee and I would guess minimum fee would be an hour of their time  200 to 500 per hour depending on area.. 

So if you want/need an attorney to read your contracts as stated find one in IN get into contract send it over to them and have them opine and do this while your under your Inspection due diligence time frames sellers dont need to know that you wanted or needed an attorney to help you understand the RE contract.

I have done a lot of bizz in IL and other attorney closing states were buyer has their own and seller has there own and title insurance is separate from it all. Very inefficient and leads to a lot of deal fails given all teh different cooks in the kitchen. //RE agents generally in IL for example they just write the basic contract send to attorney and DUCK.. Most have very limited knowledge of how escrows work and how title insurance works compared to Escrow / title states were agents are the ones who explain the basic contracts and help you through them.