There’s one question I hear from both new students and people I meet at events across the country: How do I find an investor-friendly real estate attorney to take care of my closing?
It’s a big topic to address. There’s sort of an art to finding the right real estate attorney, because you need to find a person who meets a specific set of qualifications. Locating a real estate attorney isn’t that big of a challenge; there are plenty of them! The real trick is locating an attorney who is willing to work with investors. Some attorney’s don’t do business with investors because they have misconceptions about how investors obtain their properties. Real estate attorneys might look at closings that are subject to the existing note, which can trigger a “due on sale” clause and assume it is unethical to obtain properties this way.
Nothing could be further from the truth regarding legality or ethics. People have been buying and selling homes with these methods for decades. But if an attorney does not want your business…
How do you find real estate attorneys who want your business?
There are three strategies I suggest which involve networking and referrals:
- Ask the local Real Estate Investor Association organizer.
- Ask the local REIA club’s members who have done at least 10 deals or more who they use.
- Ask an investor-friendly Realtor who they use as an attorney.
Now, I have to include a fourth strategy that does not involve referrals or networking. I can’t take credit for this method, though I wish I could! This strategy comes from one of my platinum coaching clients, Sherri Stone. Put on your seatbelts, because this strategy is so simple and powerful, it could find you an attorney in less than 24 hours.
- Step One: Get online and search “real estate attorney + your city or target market.” If you don’t get many results, expand to your county or state.
- Step Two: Send an email to every attorney with the subject line, “Real Estate Investor Seeks Real Estate Attorney.”
Ninety-five attorneys came up when Sherri did her search. She created a template which introduced herself and explained she was an investor looking for a real estate attorney to handle her closings. By the time Sherri emailed 23 attorneys, she hit the jackpot with a response. In fact, the attorney called Sherri after 5 p.m.! With Sherri’s strategy, you know the attorney you speak with wants your business before you have your first conversation.
Whether you send out emails or do some networking, locating an attorney who wants your business isn’t the end of the line. Now you have to determine if they are an attorney you want to work with. Ask these three questions:
What is their experience?
- How much of their business is actual real estate transactions?
- How many investors they work with versus traditional real estate transactions?
- Have they done assignment of contract, lease options, and “Subject To” deals?
- Basically, you want an attorney who specializes in real estate. The attorney I have worked with for 14 years handles only real estate closings, estate planning, and, for the county, they can become guardian ad litem for mentally handicapped adults.
How accessible are they?
- How long does it take them to respond?
- Do they respond by email/phone/text?
- If you have a deal going on, can you get a hold of them ASAP?
How/What do they charge (per transaction, per hour, etc)?
- Do they charge for quick questions here and there? I do not like attorneys that nickel and dime you. If I need a quick, easy question, I don’t expect to be charged, especially if it’s related to a closing. If it’s a completely random question which may require some time or conversation, I’m okay being charged for that.
- Do they charge a retainer fee?
- Am I working directly with the attorney or with a paralegal? (Note: You should be able to have contact with the attorney when needed.)
Once you locate an attorney who meets your qualifications, be sure you like working with them. Personally, I prefer to work with an independent attorney whom I can build a relationship with, not one from a big firm of attorneys. One or two additional partners is fine, but attorneys at a big firm are typically less flexible and charge more.
On a final note, remember the most dangerous number in any business is the number one. You don’t want to put all your eggs in one basket. In your search, locate at least two real estate attorneys you can work with and you’ll have a backup when needed.