The big L word (Lawyers)

[Alejandro Navarro]

I am a new investor in the Northern California area and I am working on putting together my “team” in preparation for my first deal. I keep hearing from many on the BP podcast that lawyers are a must. I also know lawyers charge a pretty penny for their time and I am not made of money (yet). My questions are: when should I use a lawyer and how can I find the best one for me?

[Katie L.]

@Alejandro Navarro

It depends what you're doing, what kinds of questions you have, your risk tolerance, your disposable income, where you're buying property, etc.  For instance, in California where you live most transactions are closed with escrow and real estate agents.  But in other states, usually attorneys handle the closings.  So having an attorney may be a necessity in another state versus just advisable or an option in California.

How comfortable to you feel entering into transactions on your own? Do you have tax questions? Estate planning questions? Need a lease agreement reviewed? Want to form an LLC? Need to evict a tenant? There are different types of lawyers out there for all these things, and real estate law touches several industries. For instance, a lawyer who litigates an eviction may not be savvy when it comes to tax planning.

Lawyers can be expensive so you want to be sure to have your needs narrowed down and your questions ready.  Despite the cost though, if you have questions it is almost always better to talk to a lawyer BEFORE taking any action as there can be consequences you are not sure of and may not be able to be undone afterwards.

*this post does not create an attorney-client or CPA-client relationship.  The information contained in this post is not to be relied upon.  Readers are advised to seek professional advice.