Tuesday, September 2, 2008

Real Estate Investing: Question of the Month

Hello All:

This months question comes from Karey of Cooper City, Florida.

Q: Should I use an attorney on every real estate transaction?

Well that's the million dollar question that has been debated since the time of investing in real estate! Some very successful people say yes, and just as many say no to legal counsel. I am of the former! Since I have a legal background I can tell you hundreds of train wreck transactions that I have either been witnessed to, or at least once removed from.
Many people think since they have experience they can represent themselves, and yes I have seen some sharp individuals in my day, however, there is an old saying in law school " he who represents himself, has a fool for a client" !

When we invest in real estate 9 out of 10 times we are emotional involved with the transaction, and are prone to overlook or at the very least make excuses to bring a speedy resolution to a problem that shouldn't be hastily tackled. That's where a good attorney comes in- you noticed I said good. When searching for an attorney that will represent your best interests, always search out an expert who only handles real estate investing transactions! Contrary to popular belief all attorneys are not equal ! Only engage an attorney that dedicates their practice 100% t0 real estate; stay away from attorneys that have general practices and do a little of this and a little of that. Also, make sure you interview your legal candidate and see what their stance is on creative real estate investing, you want to make sure that they are open to this time of investing and like wise versed in the law concerning such transactions.

Before I get a ton of e-mails asking me about states that use title companies instead of states the using closings with attorneys let me end with this caveat.
Investors in states such as Florida that use title companies for their real state transactions are not exempt from my advice on the use of attorneys! However, any and all title companies have attorneys on staff for the real estate transaction rendering, so therefore they are in a large sense representing not only the title companies interest, but also your interest as far as the legal transfer goes. It should be noted that more and more individuals are starting to engaging their own attorneys in states such as Florida in addition to the staff attorney at the title company!

Why is that? Plain and simple most people residing in Florida come from states that use attorneys for closings, and most attorneys are now capitalizing on that very thing with their marketing dollars through the use of bill boards and other advertising materials through out the state.

That's my two sense on the subject.

Be well,

James Gage