Lawyers of Biggerpockets: Non-law firm careers in real estate?

Question

Hey everyone,

So a quick bit about me, I've got a law license in Texas with the end goal of being a cashflow oriented investor such that I can build up enough passive income to meet my living expenses one day.

As the title suggests, I would prefer not work in a law firm given that, in my opinion, many young attorneys (I'm 31) are overworked and underpaid. While I went to law school solely because of my interest in real estate, the idea of working in a law firm simply isn't appealing to me currently. I'd love a career in real estate where a JD is an asset and would give valuable experience for one day becoming a cashflow-oriented RE investor.

I've been briefly considering oil and gas careers simply for the money (and the fact I wouldn't have to work in a law firm) but real estate has my heart. Given the fact I'm drowning in debt from law school I'd need a career path that would eventually lead to something close to six figures or preferably, beyond. Just not sure where to start or what job titles/niches I should be considering to get me going in the right direction.

Any advice would be greatly appreciated!

Joseph B. Davisson · Answer

3 options:

1) Escrow officer/closer for a title company.  The JD is not necessary but it helps.  As a closer, you get to see lots of deals cross your desk and see who is lending and what the terms are. You also see where investors are buying and what type of property they are buying.  I don't think there is any better behind the scenes data for a potential investor who wants to see lots of deals without practicing law.  Build client base by building relationships with real estate agents, brokers, and investors.  As a male (as your name implies) you may be able to exploit some gender bias due to most closers being female, however, my experience has been that generally women are often more effective closers due to their natural ability to multitask.  Having the skill set to close transactions is something you can take anywhere and have a career as a closer.  This work is susceptible to market dips- when there are no deals, you don't earn as much because income is often dependent on a bonus structure based on volume.

2) Appraiser.  You will learn how to value property and in turn be able to spot bargains and opportunities.  This type of work requires you to work on your own most of the time and therefore you don't get the personal contact that many successful investors use to locate and lock-down good deals.  Again, the JD is not necessary but probably helps.

Both of these options combined with your JD make you appealing as an  expert witness.  If you have the right experience and market yourself with your JD, you could make a very nice living as an expert witness giving testimony as to escrow processes, and appraisals.  While not consistent (unless you are very popular) you would likely make enough to have the time to locate deals on the side.

3) Work for a fee attorney for a title company is a good opportunity.  It is not really the typical law firm job with billable minimums (at least mine is not).  It is more deal oriented and a lot of flat rate document preparation.  You get to see all the deals an escrow officer sees, and you prepare many of the closing documents while maintaining the option of doing other real estate related legal work like lease/contract reviews, foreclosures, evictions, commercial loan documentation, entity formation for investors, and you can throw in some asset sales for small businesses and small business contract matters.

Due to the contact with active investors, being a fee attorney also opens the door for hard money lending and buying selling notes.  The best part is that it is rather insulated from the swings of the real estate market.  In good times you are busy because people are borrowing and buying and in the bad times you are busy because people are negotiating loan workouts, liquidations, and foreclosures.  Keep in mind that a fee attorney has to see transactions through 2 very distinct lenses: 1) you sell (title) insurance and need to evaluate risk that can /should be insured against or avoided but at the same time 2) investing is all about taking risks based on the potential return.  You have to be able to separate your personal risk tolerance from the insurability of a particular transaction in which you are on the side of the insurer and not a party.

GOOD LUCK.

Sean OToole · Answer

You may be able to find a larger real estate investor or hard money operation that has enough legal work to be in-house counsel. Could potentially save them a lot of money vs. using outside counsel, while getting paid better than at a mill, and while getting a front row seat to the action.

Joseph B. Davisson · Answer

* forgive my grammar-I'm trying to get out of the office quickly....

Escrow officer: Yes bonus is a part of the compensation structure but my experience is that is based on dollar volume and number of closings so it is paid throughout the year and not a year end type of bonus.  You usually know where you are as far as an expectation of income.  Dont let that scare you.  If you want to be an investor, you have to be comfortable with eating what you kill and the same applies to closing escrow.  Deals are going to blow-up-it happens. As far as the career leading a different direction, I should have been more specific.  While being an expert witness is one direction it could lead, I was really suggesting that it is portable skill set in that you can go to any market and work as a closer.  Of course the skills do translate to other business like banking.  One good thing is that an escrow officer and an investor rely on the same contacts: agents and investors as a source of business and opportunities.

Fee Attorney: I cant think of anyone in Austin off the top of my head, but generally the more entrepreneurial fee attorneys (the ones that will write wraps or subject to deals and work with wholesalers) will probably be your best bet.  Stay away from the high-end retail storefronts that do high volume residential transactions where the buyer and seller have agents and there is a big bank lender funding most transactions.  They do "retail" type of transactions.  You want to go where the action is.  Look for someone small investors use.  This is going to be the best opportunity for information and contacts you can actually use.

In the past 20 years I have seen the most successful investors/agents/attorneys have the same thing in common: LOW OVERHEAD.  You don't need a fancy office and new furniture.  You need overhead that will allow you to live/travel/play comfortably and survive/thrive in the lean times.  Your clients wont care if you are in a C+ building and its hard to get a bargain on real estate when you pull up in an $85,000 car.  (not to mention that many of the best opportunities are in areas where you don't want to be driving a nice car).

Do your homework and locate a good fee attorney (or escrow officer who closes for a fee attorney) in your market and go ask them questions.  Better yet, bring them a deal to close or send them a referral.

Clay Wyant · Answer

Thanks for the input. My only hesitation (which could be completely illusory at this point) is that I've never formally practiced law, despite having a law license. I'd suspect they'd want someone with experience but maybe junior roles would be open too. Good idea though, perhaps I'll be able to hunt a few people down who are in similar roles as this and be able to pick their brains a bit to get an idea of my prospects. Thanks!

Clay Wyant · Answer

Thanks for hanging around the office a bit longer on my accord!

I'm definitely going to be reaching out and trying to grab coffee with some escrow officers and fee attorneys now to paint a better picture of what's what & opportunities. And I'm definitely with you on low overhead. Whenever I see a 85k car, I just see two or three down payments on cash-flowing properties that has been unfortunately transmuted into a depreciating asset on wheels. Again, thanks for taking the time to help out a novice!

Clay Wyant · Answer

Thanks for the detailed reply! I have briefly looked into being an escrow officer for a title company, but am uncertain as to how much bonuses play a role in compensation and what career paths it could open up. You mentioned that having the skill to close could bring my career in many directions - I'd be curious to hear a few potential career paths that you think being an escrow officer could open up. It'd also be wise for me to reach out to some successful escrow officers and see if they could provide any insights. If you know any who might be willing to answer a few of my questions, I'd be beyond grateful.

As for being a fee attorney, that wasn't really even on my radar until just now. The idea of having a stable stream of work is appealing and I've also had a great interest in notes (I've been to several of Eddie Speed's Note Expos and they're always great). If I went this route, would my only option be to enter a law firm that works with a title company? Or would I be able to work directly with (or even for) a title company directly and have enough work to make it sustainable? I'll confess my knowledge as to fee attorneys is lacking so any further insights you could provide would be great.

Thanks again for taking the time to write all this out and give me your two cents - it's very much appreciated!

Lawyers of Biggerpockets: Non-law firm careers in real estate?

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