AIA Contracts

[Timothy W.]

Jason did a great blog on contracts: http://www.biggerpockets.com/renewsblog/2010/02/17/whats-in-a-contract-contractors-rehabbing-real-estate/

Wanted to pass one tip along. He mentioned new investors who can't afford to have contracts written from the ground up for rehab projects. If you can't afford to have an attorney write a contract from the ground up, an option is to buy a pre-made contract from the American Institute of Architects: http://www.aia.org/contractdocs/index.htm

I had to do a couple 200k+ projects on these AIA contracts back when I did remodeling with my dad - in every case we used these, it was on recommendation from an attorney and I never ran across an attorney that saw any need to modify an AIA contract. IF you are ever in court and need to draw upon this contract, it has the AIA's name behind it - which is kind of like the Vatican of the construction industry.

[Timothy W.]

LOL, I got the notification and was thinking "When was I talking about AIA contracts?".  My perspective now, 8 years later, 1 nasty lawsuit later, and being a second year law student, is pretty much the same except I'd have an attorney review it.  Much cheaper than having an attorney draft a contract but it's still worth a couple bucks to have someone review it.  I cheaped out on having an attorney review a contract at the beginning of a deal and paid 10k in legal fees fighting it out at the end of a contract.   I was dealing with a dishonest partner who thought she could edit pdf documents and they wouldn't created a metadata trail of what she did.  I won in the end but it still costs money to win, and she did inspire me to also become a lawyer so I could nail more dishonest scumbags like her, but a lawyer would have had this recorded properly at the outset.  It's much cheaper getting a lawyer at the beginning of a contract than at the end of one.