Adam
New Contributor
I always use an attorney to create the LLCs that we conduct business under & to hold our properties. Creating the LLC isn't the issue, its the bylaws and member control agreements that need to be very specific in their wording. These are what ultimately protect you, not if, but when something goes wrong. We also used our attorney to draft all of the initial vendor contracts, commercial leases, contract for deeds and to advise in all transactions where we are utilizing private individual investors to fund the holding LLCs.
Under a normal residential transaction, where you utilize a purchase money mortgage, a conventional purchase agreement, etc. there is usually very little need for an attorney (generally speaking).
Now, having said that, in the foreclosure market, if you don't understand your state laws about recission periods on foreclosure purchases, redemption period, equity stripping, etc. you should consult an attorney to review your transaction as a whole.
Last, if you are truely "flipping," you should also consult a GOOD RE agent and mortgage banker to discuss your exit strategy. Now days, residential lenders are having big issues with property seasoning (the amount of time the seller has been on title) and unjustified increases in sales price from one recent sale to another (ie - your buy for $120K and resell a week later for $180K). The property may appraise for you current, higher sales price, but the lender may not approve the financing.
Now is a great time to get in, but I would never do so without a good lawyer, RE agent that understands the foreclosure laws and a lender that understands investment property financing.
Under a normal residential transaction, where you utilize a purchase money mortgage, a conventional purchase agreement, etc. there is usually very little need for an attorney (generally speaking).
Now, having said that, in the foreclosure market, if you don't understand your state laws about recission periods on foreclosure purchases, redemption period, equity stripping, etc. you should consult an attorney to review your transaction as a whole.
Last, if you are truely "flipping," you should also consult a GOOD RE agent and mortgage banker to discuss your exit strategy. Now days, residential lenders are having big issues with property seasoning (the amount of time the seller has been on title) and unjustified increases in sales price from one recent sale to another (ie - your buy for $120K and resell a week later for $180K). The property may appraise for you current, higher sales price, but the lender may not approve the financing.
Now is a great time to get in, but I would never do so without a good lawyer, RE agent that understands the foreclosure laws and a lender that understands investment property financing.
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