For $1,200 a month, Patricia Torres and her family were renting a bedroom, a share of time in the bathroom, one vegetable drawer and one shelf in the fridge, and two cupboards over the stove. They rented not so much a home as a fraction of one.

Karen Calderon had even less: a single room in a homeless shelter where she was not allowed so much as a hot plate to cook for her family.

Adrian Caratowsa had a studio he’d remade as his own, repainting the walls and wallpapering over the kitchen cabinets. But every day for five years, he walked out into a neighborhood he found depressing.

For each, San Francisco’s housing crisis had meant living without essential elements of home. A large affordable housing development rising downtown promised what they did not have: 95 complete homes, one-, two- and three-bedroom apartments with privacy, a sense of peace, a place to cook.

More at CNBC

“Real estate” finds people in a lot of interesting situations.  A very blue collar individual may find themselves “partners” on a real estate project with a very successful surgeon.

Rich doctor puts up the money.  Blue collar carpenter puts in the sweat equity.  They both split the profits.

Now would next statistic surprise you?

If you’re a doctor in a high risk specialty the odds of facing a lawsuit at some point in your career is 99%.

Do you want to be “partners” with someone who will very likely face a lawsuit?

In fact, some specialty doctors have a 19% chance of being sued – THIS YEAR!  Do you want to have your property or your profits tied up in litigation?

Still interested in “partnering” with the rich doctor?

I recently saw an online quiz.  No, not the kind that tells you what super-hero you would be.  This quiz had you answer questions about how high of a risk you were for being sued.

You would be surprised how many things we do as real estate investors that puts us into a high risk category.

For instance – tenants.

We were told to add 2 points – for every tenant.

Luckily, there is insurance that helps protect you from high risk situations, but let’s leave the rest of the conversation for tomorrow evening at WREIA.

Re: McDonalds Coffee Lady

Remember the lady who sued McDonalds because her coffee was too hot?

This was back in 1992. Stella Liebeck ordered a cup’o’joe to go. She was sitting in her nephew’s car, pulled over so she could add sugar to her coffee.

When she tried to remove the lid, the coffee spilled on her legs causing third degree burns over six percent of her body.

Ms. Liebeck sued McDonalds for $20,000 in damages.

She won.

She was awarded $200,000. That amount was reduced to $160,000 because she was found to be 20% at fault.

The real kicker was she was also awarded $2.7 MILLION in punitive damages.

Raise your hand if you think McDonalds wishes it would have just paid the $20k?

But that was 1992. People can’t file these frivolous lawsuits any more, right?

Wrong.

The truth is, people can sue you for just about anything in 2018.

And in our world of real estate, the numbers can be big. You better believe eventually, some how, some way, someone is coming after your money.

But what can you do?

Can, or should, you defend yourself?

What are your chances of “winning” even if you do hire an attorney?

What can you do to prepare yourself for when it does happen?

I can’t give you legal advice. I’m not an attorney. But our next WREIA guest speaker is – and he is bringing some good “from the trenches” stories next Monday.

Our WREIA speaker this month is going to give you real-life examples of mistakes that he sees new and old investors making over and over and over again. Those preventable mistakes are usually what brings people to his practice looking for legal help.

This is a great time to learn from other peoples mistakes. It could save you some serious headaches and sleepless nights down the road. Not to mention – it could save you a small fortune in legal bills.

Join me on May 14th as we talk about real estate law.

Join us and learn:

• Case Studies – Including…. Real Estate Partnerships Gone Wrong
• Financing “Loopholes” or Traps?
• Money Problems In MD Transactions
• Beware of these “legal speed bumps”
• Contractors – Buckle Up or Go Broke
• When financing goes bad – a few stories you can learn from and avoid
  and more

Bring your questions for the Q&A section. Our speaker is a local attorney and long-time WREIA Member with extensive experience working with investors across the DC area.

Save a few dollars and reserve your seat early. Then, come join us at WREIA – Monday, May 14th. It will be a great meeting to finally start the spring season, get you motivated, and get some momentum for the rest of 2018.

Join us as we talk about Real Estate Legal Problems and Lawsuits.

Meet real people doing real deals in real estate – right here in the DC/Baltimore area.

Reserve your seat at this link.

John Peterson
Founder, Washington Real Estate Investors Association

Re: Robert Louis Stevenson

Have you ever been sitting at a breakfast with a group of good friends, and one of them is having some serious “real life” problems?

Next thing you know, the hothead (every group has a hothead) pipes up and almost screams “You should sue his #$$!!!”

That is usually not the best advice to give someone.

You know you have found a good attorney when they tell you to do everything you can to avoid a lawsuit. No one really wins when things go that far.

Most of the time, a simple conversation will go a long, long way.

Robert Louis Stevenson (famous writer of Treasure Island and Dr. Jekyll & Mr. Hyde) summed up our May WREIA topic best when he said

“Compromise is the best and cheapest lawyer.”

He’s right.

If you haven’t had a legal problem in this business you haven’t been doing it long enough.

The older, experienced, gray-haired folks at WREIA will also tell you Mr. Stevenson is 100% correct.

At some point, you will have a problem. We all have.

At the beginning of a problem let’s reflect on words from the Dalai Lama:
“When we meet real tragedy in life, we can react in two ways – either by losing hope and falling into self-destructive habits, or by using the challenge to find our inner strength.”

But before we get too sappy, sometimes, we need to go beyond finding our inner strength and find a strong lawyer.

But where is the line?
When is it time to end the conversation and get representation?

At no point have I ever felt good walking out of a courthouse. (Except years ago when I was searching tax records for property owners – but we do that online now.)

For instance – something as simple as a speeding ticket. If you go to court to ask for a little leniency from the judge – it is NERVE WRACKING. The judge is in there sending people to Jail minutes before your name is called. Feels a little silly to step up and ask for the fine to be reduced, but yeah, I did that.

The easiest advice I can give you is this – don’t get caught in a bad situation to begin with. Good communication and good contracts go a LONG way in our world.

Our WREIA speaker this month is going to give you real-life examples of mistakes that he sees new and old investors making over and over and over again. Those preventable mistakes are usually what brings people to his practice looking for legal help.

This is a great time to learn from other peoples mistakes. It could save you some serious headaches and sleepless nights down the road. Not to mention – it could save you a small fortune in legal bills.

Join me on May 14th as we talk about real estate law.

Join us and learn:

• Case Studies – Including…. Real Estate Partnerships Gone Wrong
• Financing “Loopholes” or Traps?
• Money Problems In MD Transactions
• Beware of these “legal speed bumps”
• Contractors – Buckle Up or Go Broke
• When financing goes bad – a few stories you can learn from and avoid
  and more
• Bring your questions for the Q&A section. Our speaker is a local attorney and long-time WREIA Member with extensive experience working with investors across the DC area.

Save a few dollars and reserve your seat early. Then, come join us at WREIA – Monday, May 14th. It will be a great meeting to finally start the spring season, get you motivated, and get some momentum for the rest of 2018.

Join us as we talk about Real Estate Legal Problems and Lawsuits.

Meet real people doing real deals in real estate – right here in the DC/Baltimore area.

Reserve your seat at this link.

John Peterson
Founder, Washington Real Estate Investors Association