If you think attorneys are only useful to review mortgage agreements or to draft tenant leases, you better think again. Owning an investment property takes a lot of time, but it can also open up your liability as a landlord. Part of protecting yourself as well as your real estate investments is finding and retaining a great attorney. Selecting the right laywer in something that many investors struggle with and experience definitely counts. There are many situations why you need a lawyer when you own investment property. Keeping yourself out of legal situations or fighting for your legal rights is one of the less attractive jobs of a real estate investor.
Why You Need a Lawyer When You Own Investment PropertyOne of the things that can drain your investment income fast is legal expenses. The cost of hiring an attorney is a small price to pay compared with losing your entire investment over a legal problem. The most common reason to hire an attorney is landlord-tenant issues. Whether you buy investment properties out of state or in state, you cannot be expected to become a legal expert overnight. If you cannot be at your property everyday, a legal problem could arise and you could be held accountable. State laws are very strict when it comes to tenant rights. Hiring or retaining an attorney to help review your lease terms is always a good practice. Any complaints that are brought up by your tenant can be checked for legalities by your attorney. This can help keep you out of hot water if a tenant issue is escalated to a lawsuit.
If you plan to upgrade your investment property, this work will usually require investment property contractors to complete the work professionally. Many contractors should be hired with an agreement to protect the investment that you make to upgrade your property. Attorneys that specialize in real estate understand contracting laws and what is to be expected in each contract. These professionals can also provide legal assistance to you if there is a problem with a contractor or in the finished work. Protecting your rights as an investor is one of the ways that you can retain more of the rental income that you make. States with high foreclosure rates often have a larger than average percentage of unscrupulous contractors that prey on beginning real estate investors.
Business Formation and Future Liability ProtectionThe business structure that you use for your real estate investing business can be evaluated by an experienced attorney. When it comes to dealing with the public, certain business entities receive asset protection under the law that normal individuals do not receive. Retaining a real estate attorney when you own investment property can ensure that your current legal formation does not open up further liabilities. A civil suit brought on by a tenant can easily wipe out your entire investment plus any of your assets. Personal and business protection is another reason why you need a lawyer when you own investment property. Price is always important to consider when hiring an attorney, but some attorney fees can be negotiated. The experience factor, cases won and retainer fees should be kept in mind when estimating and comparing attorney costs.