Attorneys for Offers?

[Leonard Rybak]

Hi, I am currently looking for single family homes for approx $100k-150K. I make offers using a realtor and then they send me everything to sign and submit my offers to sellers. And these offers if accepted become legally binding contracts, and in turn I then have to send earnest money to a title company listed on the contract. This seems pretty simple.   

But,  a mentor of mine said I am doing it all wrong and should be using attorneys to hold my earnest deposit as well as look over these "offers" before I sign anything.  I cant manage to wrap my head around this. 

As anyone done or is currently doing this? How do I go about doing this and is it worth it for my level of property value .

Doesn't this create too much of a time gap between offers and counter offers, and basically create the chance that I will lose out on deals in a hot market. ? 

Any advice would be highly appreciated.

[Dylan J Berget]

As an attorney, I've got a lot of thoughts on this. To put it simply, you probably don't need an attorney for what you're currently doing. While an attorney can be helpful in some situations, for deals in the $100k-$150k range that don't have a lot of legal complexities, it might not be worth the time or money. It's important to check who holds earnest money in your state, as it can vary. Your mentor may be in a state where attorneys handle the closing process.

One issue with involving an attorney is that it can make transactions more complicated, as they may view certain aspects as risky that an investor is okay with. For smaller deals without many complexities, it might make more sense to proceed without an attorney.

It's worth noting that there are some situations where involving an attorney is recommended, such as with probate deals or foreclosures. However, for most deals in this price range, it's likely unnecessary.

That being said, I don't think real estate agents are worth their expense either. Their commissions are often much higher than what an attorney would receive for a similar amount of work. In the future, if you become more comfortable with the process, you could consider writing your own offers to make them more competitive. This can be simple once you learn the process, and it can be more enticing to sellers because they can end up with more money in their pockets.

If you do decide to engage an attorney, it's important to find one with experience in real estate transactions. Not all attorneys have that background, so it's crucial to do your research.

*Edit* Almost any contract used by a real estate agent was reviewed by an attorney at some point. These contracts are just plug-and-play now.  Just know what contingencies you have, and get title insurance. I might be coming at this a little biased because I am an attorney and understand the process. But I swear it's a lot more simple than people make it out to be. You want contingencies so you can walk away from a deal if you find out it's a bad deal. You want to make sure that there are no restrictions on the property that stop you from using it the way you want. And you want it to make you money.