First off let me state that my business is honest and reputable. We do many deals in the area. However until we recently learned the hard way of it’s importance, we had not been collecting testimonials. We follow everything legally and confirm this with our lawyers.
However from time to time I get the following response from people: “I’d like to run this by my attorney.” And nine times out of ten, they come back with “We’re going to pursue other options.”
This is usually in cases where we discuss owner-carry financing or signing over the deed, or lease-optioning. The average homeowner is not used to these strategies and gets very concerned. And the ones who are business savy are usually used to bringing everything to their attorney first.
I’ve heard it’s best to try to convince them not to mull over it, not to go to their attorney, etc. But how you do that is difficult.
I would look for DESPERATE sellers - they don’t care about the financing. They just want to get rid of their problem.
In any case, I certainly would not try to convince someone not to see their attorney. That wouldn’t look very good when they sue you. In fact, I make all individual sellers sign a disclosure which clearly states at the top that they should see an attorney if they don’t understand the contract they are signing.
I agree completely w/ Mike’s advice. Personally, if someone tries to dissuade me or otherwise offers some hesitation about me showing something to counsel, I instinctively think they have something to hide. Right or wrong, that’s how I react. In my dealings, both in my banking and REI deals, I do much the same as Mike in that I insist that the other party acknowledge in writing that they have been advised to contact their counsel and have been afforded a reasonable opportunity to do so. After all, I have nothing to hide…
An approach you might use is to say “It’s important to me that you’re entirely comfortable with the deal I’m proposing and as such, I strongly recommend you seek counsel of your choice to look everything over. If for whatever reason you choose not to do so, I’ll be asking you to acknowledge in writing that you have made this choice of your own volition.” Something like that…
Thanks for the replies guys. Everything you said is right on course. I’d never advise that they don’t seek counsel. Quite the opposite of course and like you I have them initial next to various disclosures including that they have the option to seek legal counsel if they should desire.
However many attorneys simply don’t understand creative financing and what people don’t understand, they often fear and thus homeowners get scared away from doing business.
Obviously we are much more successful with DESPERATE sellers, but those few times when sellers seem willing and yet their lawyers aren’t seems to screw up deals and I wish I could figure out a good explanation to give up front so that they don’t get scared away by their attorneys.
I always ask them to run it by their lawyer. There is no lawyer that will ever allow his client to engage in an owner finance or contract for deed, etc. but down the road when the “tenant” has a problem with the deal, I can tell him that I asked him to run it by his lawyer.