The Questions You Should Ask Your Potential Real Estate Attorney
When investing in real estate, the legalities involved can be very complicated to understand, especially if you don’t have a law degree. Investors run into many problems during the overall process, and due to lack of knowledge or experience in real estate law, they tend to find it difficult to proceed. It is a great idea to use a real estate attorney when making an investment because they can provide you with the advice you’ll need through the whole process. However, it isn’t as simple as just picking up the phone and calling an attorney who works in real estate. There are certain questions you should ask of your possible lawyer before moving forward.
Why Do I Even Need An Attorney?
Before explaining what questions you should be asking a potential lawyer, first you must convince yourself that you even need one in the first place. Real estate investing is filled with contracts, documents, paperwork, and agreements between two or more parties that are filled with legal jargon a non-attorney may not understand. Issues arise when one doesn’t properly fill out their entity’s paperwork. Confusion can occur when investors are not aware of what to look for in the purchase and sales contract. At closings, investors need to know what exactly to bring, what documents to sign, and how the overall process works. Title issues surrounding unpaid fees and judgments that are causing liens on the property are significant problems that an investor may not be able to handle on their own.
…..Time to talk to an attorney.
What Is Their Experience In This Field?
This might be obvious, but you would be surprised to learn that just because they are a real estate lawyer, doesn’t mean they are experts in every aspect of real estate law. Some cover commercial or deal with financial lenders, while others handle just residential real estate transactions. There will be different parts of a contract depending on the type of real estate, so knowing if your lawyer is skilled in this area is essential. Delve even deeper than just if they have dealt with residential properties before and find out if they have specifically handled investment property deals. The more specialized experience your potential attorney has in the field you are working in, the greater chance your partnership will be successful.
How Skilled Is Their Staff?
You aren’t always just dealing with the attorney when you hire them. Similar to what you would ask your primary attorney, you’ll want to know the level of experiences of their staff, paralegals, and other attorneys in the office who may become involved. Question what the procedure is if your attorney goes on vacation and you have questions or aren’t finished with the deal yet. Who will be taking their place and how experienced are they? Same goes for their paralegals. Find out if they have dealt with residential investment properties as well.
Are They Also A Title Agent?
Ask if your attorney is also a title agent. In some states, real estate lawyers can also double as title agents and may even have one on staff in their office. This can make things so much easier because if their office controls the closing process, they don’t have to coordinate with another office who may be poorly organized, which will only inhibit the overall process.
How Much Do They Charge?
As an investor, the focus is making valuable investments that will return a nice profit in the end. If you are looking to hire an attorney to represent you, you have to keep in mind the legal fees. Ask your attorney how much they charge before deciding if they are the one to work with. If your project is going to cost you $75,000, and you have to pay the lawyer $10,000, that’s a large portion cutting into your possible profits. Keep this in mind when deciding who you want to hire.
Where Are They Licensed?
This is very important for a real estate deal because you’ll want a lawyer who is licensed in the state in which the property is located, not just the state where you, as an investor, live or are incorporated. Real estate law is state specific, so having an attorney who knows the exact laws of that state will only make things easier. Many investors don’t even realize that some states require you to have an attorney present at closing, so finding a lawyer who practices law in that state will become even more of a necessity.
Whether or not it is a requirement to have an attorney when closing time arrives, it is always a good idea to hire one anyway. There will be contracts that you may not fully understand, no matter what level of real estate investing experience you have, so make the wise choice and use an attorney going forward with any future real estate investing.