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10 Costly Mistakes to Avoid as a New Real Estate Investor<br />
Legal: The next team you’re going to need is legal . Quality legal work is<br />
extremely important when purchasing and owning real estate. Attorneys can<br />
help protect you as you buy, own, and sell real estate. They can handle<br />
contracts, set up the appropriate legal structure, and make sure you have<br />
legal leases. They are essential for avoiding costly mistakes. The attorneys<br />
you use in a transaction can consist of real estate, transaction or contract<br />
attorneys, and securities and exchange attorneys if you are going to be raising<br />
money from outside investors. We always recommend the use of a qualified<br />
real estate attorney for your transactions.<br />
Equity – Equity is the money needed to buy a property. If you’re financing a<br />
portion of your purchase, equity is the amount you need outside of the<br />
financing. This can come from an individual or from a group of investors. If<br />
you use a group, you need to make sure you follow rules for pooling<br />
investors. You can check with your local, state, and federal authorities to find<br />
out the specifics in your area. A qualified securities and exchange attorney<br />
can also be very helpful.<br />
Financing – If you do not plan on paying all cash for your next investment,<br />
you will need to have others to help you get financing. This team consists of<br />
lending institutions, private individuals, and mortgage brokers. These are<br />
individuals or institutions that will provide a significant portion of the money<br />
needed to purchase your next investment property.<br />
Property Management – Once you have purchased an investment<br />
property, one of the most critical teams is your property management<br />
group. This team will operate your property on a daily basis. They will take<br />
care of repairs and maintenance. They will also collect rent and lease your<br />
property. In our experience, this is the team that can make or break your<br />
investment. If you plan on using a third-party property management company<br />
instead of managing the property yourself, make sure you pick a company<br />
that is experienced in the area, type, and size of your property. 27<br />
10 Costly Mistakes to Avoid as a New Real Estate Investor