5 Important Questions to Ask a New AttorneyBy JD Esajian on February 20, 2019
There are three main clogs on any successful real estate investor’s team: their real estate agent, their contractor and their attorney. It is debatable which one is most important, but there is no debating that they all play an important role. Regardless of what stage of the business you are in, you need a quality attorney to help guide you through tough deals and help protect your business. Your attorney is too important to simply pick the first one you talk to or act on a recommendation of a networking colleague. You need to know that your attorney will be there for you and always has your best interests in mind. If you are not completely confident in their abilities, you need to keep looking until you find someone you truly want to work with. Here are five important questions to ask to discover if a new attorney is the best fit for you.
- Are you a Real Estate Attorney? Unless they are superior it is tough to find an attorney who only specializes in a specific niche. They may focus on one thing but are capable in other areas. You don’t necessarily need a dedicated real estate attorney, but they can’t be a trial lawyer either. Your attorney must have a staff that can handle title requests, review contracts and know how to tackle real estate related items. They may be great in other areas of the business, but if they don’t have a real estate background you could find yourself behind the eight ball. It is ok to come right out and ask them how they handle real estate closings. In most cases there is a paralegal, or two, that can answer questions and expedite the process. If not, you need to think long and hard about working with someone else.
- Who Will I be in Contact With? The average attorney has a handful of things going on at once. You cannot expect them to drop everything if you have a basic question. That being said, you should still be able to have a question answered in a reasonable timeframe. It is important to know who you are going to be working with. As we stated, in most cases your communication with your attorney will be minimal, at best. You will usually talk to one of the paralegals in the office. Ask how quickly they respond, and which is the best way to communicate. With email and text messaging it doesn’t take longer than a minute to get back to someone. As busy as the office may be, if there is a pressing time sensitive matter you should expect a quick response. If they never answer the phone or only respond to email in a dedicated block it may be difficult to fully trust they can handle your inquiries. Without knowing what is always going on, there are probably other attorneys that would be better suited for your business.
- Can You Guide Me With Entity Protection? Knowing how to best protect your business can be a difficult proposition. Assuming that an LLC is best may not always be right for you. Having an attorney that can walk you through the pros and cons of each option is worth their weight in gold. Every real estate investor is a little different and can have different needs and desires. An LLC is the most common, and usually the best form of protection, but doesn’t always work for every property. Not having the right protection on a property can cause a major problem for your business if there is an unexpected issue. Your attorney should not only guide you through this process, but also get the wheels in motion for you. This is relatively easy work for an attorney and something they should be comfortable doing.
- What Are Your Fees? As you can see, fees should not be your top concern when choosing an attorney. You are spending tens of thousands of dollars on a property, so there is no need to nickel and dime yourself on the attorney’s fees. In most cases, the fees will be in the same ballpark regardless of who the attorney is. You just need to feel confident that you are getting value for what you pay for. A good attorney who can catch an item on the title or negotiate a sticking point on a contract is worth their weight in gold. It is not worth trying to beat an attorney up over a few hundred dollars. As long as you know they have your best interest in mind, you should be comfortable paying whatever they charge.
- Have You Worked With Anyone Else on My Team? The best investors work as a finely tuned machine. Everyone knows their role and executes it to the best of their ability. What makes real estate so difficult, is if just one person drops the ball it impacts everyone else. If you have a long-standing relationship with a real estate agent, builder, mortgage broker or contractor you should ask your attorney if they have worked with any of them in the past. If there is any friction or there has been a negative relationship you may want to look in another direction. Your team will all have some contact with your attorney at some point and you don’t want it interfering with your business.
A good attorney can make or break your business. Don’t be afraid to ask the right questions before committing to a new attorney.