There is no way around it, if you are a real estate investor you will get sued. Real estate investors are often vilified as sharks and bottom feeders that prey on the misfortunes of the little old lady who didn’t know what was going on. Yes there are bad apples in every industry but it doesn’t mean that the whole orchard is poisoned. If anything, it is real estate investors who increase value of neighborhood properties by taking homes nobody wants, fixing them up, and substantially increasing their value. Yet special interest groups and “do-gooders” don’t see it that way, instead they focus on the profit real estate investors make rather then the good we do. If you are a real estate investor there are three things certain in life, death, taxes, and getting sued.
After buying and selling over 500 properties in a 5 year span, there is something that I see time and time again. When you save a distressed homeowner, you are their hero at the closing, but quickly turn into the bad guy as soon as that first person comes along and tells them they got taken advantage of, even if it isn’t true. Investors are then shaken down by free legal service that, of course, believes every word that this distressed homeowner is saying. I have learned that these distressed homeowners will say anything and everything to keep their home, even if it means lying. If you tell a lie for long enough, you come to believe it yourself, which is exactly what happens to distressed homeowners after years of litigation.
First, when you get sued, you want to fight on the principle that you are right and they are lying, even though you will quickly realize that the legal system is not about right or wrong, but how much your lawyer will take from you. While you are fighting this, the distressed homeowner will be enjoying free rent, free legal service, and free press, and you are left with nothing but a big legal bill. Let’s be honest here, even if you win (like I have), you lose. The system is unfair, but I have now accepted it as part of doing business. As a result, I would like to offer you some wise words of wisdom.