Every new real estate investor wants to close their first deal as quickly as possible. As great as it is to make offers you need to have a team in place ready to handle them if they are accepted. If not all the good work you did finding the deal could be for naught. There are a few key team members that are especially important. These are the core five that you should take your time reaching out to and making sure you are on the same page with. Ideally you will work with these people over the next several years on dozens, if not hundreds, of deals. Here are the five team members you need to have in place prior to making an offer.
- Real Estate Attorney. It is essential that you are protected on every deal you get involved in. A quality attorney that understands real estate should be a cornerstone of your business. Not only will they help guide you through the ins and outs of every deal but they may be able to offer advice on how to structure your business and which contract items to avoid. All it takes is one bad deal to change the course of your business for the worse. Without having your attorney review a contract you are asking for trouble. Where many investors get into trouble is thinking that all attorneys are the same. You should find an attorney that focuses specifically on real estate. They should have a paralegal on their staff and be able to communicate with you without making you wait for a call or email back.
- CPA. There are certain business expenses that are essential if you want to move forward. Hiring a certified public accountant is one of them. There is an instinct when you are just starting out to squeeze and conserve every possible dollar. Saving money is important but not at the sacrifice of your accountant. An CPA will help with setting up the right business structure that offers the utmost protection. Many new investors purchase real estate under their own names without understanding the risks and potential downside of this. Your CPA will not only make recommendations but take the steps to get the ball rolling with setting up an LLC or whatever entity you choose. They are also essential with tax strategy, specifically near filing time. The right deductions and write offs can literally save you thousands of dollars every year. Much like with finding your attorney you should seek an accountant with some real estate pedigree. If they don’t understand the ins and outs of real estate they may not be as likely to offer the right advice that is specific to you.
- Mortgage Broker. Every offer you make is influenced by the financing. Even if you don’t plan on using traditional lender financing it is good to align yourself with a quality mortgage broker. A strong case can be made that you should start your team search with a mortgage broker. An experienced mortgage broker has access to several different people directly in the business. They may be able to help set up a meeting with a hard money lender or even a real estate agent in a specific market. The probably know a real estate accountant or attorney you can talk to. Their primary role is to find the best financing options for you based on your goals and financial situation. Long gone are the exotic stated income and zero down payment programs for residential properties. However, lenders are constantly changing and tweaking their loan programs to generate new business. A good mortgage broker often has access to programs that a local lender wouldn’t.
- Contractor. Regardless if your primary focus is on quick fix and flip rehabs or buy and hold rental properties it is essential to find a quality contractor. Almost every property you have an interest in buying will need at least some work done. If you are new to the business you may not have any idea of the costs associated with the work. Even if you have experience it is often difficult getting your estimates as close as possible. What you should look for with a contractor is one that shares your vision and sees the long-term potential. Many contractors will not give free estimates and accommodate you every time you plan on making an offer. You should find a contractor that realizes there may be times when work is done for naught but there is also plenty of work, and income, on the properties that you do get.
- Real Estate Agent. The final essential team member you need is a real estate agent. A real estate agent does not only help find deals in your market but they will get them sold for you as well. Like every other team member, it is important that you find an agent that is a good fit. A successful listing agent may not have the time to provide the service you are looking for. You need to find someone that is hungry and understands how it is working with an investor. There will be several offers that aren’t accepted but there should also be a good amount of business as well. You need to be confident that they know the market and your investing goals and expectations.
Real estate investing really is a team sport. You don’t want to have to scramble around finding your team after your offer is accepted. Get these five people in place before your business gets too far off the ground.
