When you own property, one mistake can put everything you’ve worked for during your lifetime at risk.
Many people believe that an insurance policy can protect them from lawsuits, settlements, and debt payments, but policy limits and claim exclusions can leave your real estate holdings vulnerable.
A real estate asset protection attorney can help protect your real estate assets against potential creditors and claimants.
What Is a Real Estate Asset Protection Attorney?
The role of a real estate asset protection attorney is to protect your assets for your life and future generations. Ownership of your real estate properties can be threatened by lawsuits and other claims, and an attorney in this field can take proactive measures to help you avoid a lawsuit.
A lawsuit can potentially be avoided if you legally shield your assets from prying eyes, hiding them from the plain view of creditors and claimants. Your attorney can help you protect your assets in case of a dispute.
What Services Does a Real Estate Asset Protection Attorney Offer?
The services of a real estate asset protection attorney include helping clients avoid the loss of property. There are various tools an attorney can use to accomplish this goal, many of which work in concert. Services include:
- Selecting the right insurance plans: Insurance is the first line of defense in a dispute that can threaten your assets. If your insurance can cover the damages or losses, your assets may be fully protected.
- Compartmentalizing your assets: Creating a boundary between your assets and risk through LLCs and other instruments can limit your liability and protect your assets in a dispute.
- Separating your assets: This method typically involves creating a holding entity. From a practical standpoint, options include an LLC or trust.
- Keeping assets anonymous: Before employing the steps above, your asset protection attorney will recommend initial strategies to ensure that assets won’t be linked to your name. When people begin poking around to find out how much you’re “worth,” they’ll come away thinking you have little or nothing to attack (or that you might have a lot of assets, but they’ll be difficult to go after).
- Equity stripping: This method protects your personal residence and other personal property that can be attacked in a lawsuit. By assigning a lien to the property, it minimizes the value of the asset by taking away any equity. As a result, creditors will view the asset as “worthless.”
- Estate planning: An overall estate plan can also be used to protect your assets in a variety of scenarios. There are various instruments that can be used in asset protection, including wills and trusts.
How Real Estate Asset Protection Attorneys Protect Real Estate
Asset protection attorneys find a blend of asset protection strategies to implement for your specific goals and asset portfolio. Generally speaking, when someone wants to sue you and they can’t identify anything of value to seek in a settlement, you can likely let your insurance company handle everything without dipping into your net worth.
A classic example of how an asset protection attorney protects real estate is when a plaintiff wants to file a lawsuit, and their lawyer is trying to figure out who to sue. Almost always, a plaintiff’s attorney will almost always go after whoever has the deepest pockets.
An attorney working on a lawsuit to attack your assets will begin the process by searching for various assets that each potential party to the case owns. If you don’t have assets in your name because your asset protection attorney has created an asset protection plan for you, your assets are less likely to be attacked, and the other party’s attorney will focus on getting paid by your insurance company or other defendants.
Anonymity planning can work well because if someone is considering suing you, they are less likely to pursue it aggressively because they don’t know what assets you own.
Factors to Consider When Hiring a Real Estate Asset Protection Attorney
There are a lot of attorneys out there, but it’s important to find one who truly understands and is experienced in the area of asset protection. As you research asset protection attorneys, keep the following considerations in mind:
- Qualifications and experience: An attorney should have knowledge and experience in the field while being current on best practices and proven asset protection strategies.
Therefore, the first question we recommend asking an asset protection attorney you are considering hiring is how many real estate investors they’ve worked with and if any have been sued. If there have been lawsuits, inquire about the outcomes. - Reputation: Word of mouth is still a great way to find competent attorneys, and you can learn a lot about how someone works based on what others say about them. Check Google, AVVO, and the attorney’s social media accounts, to see what other clients who have worked with the attorney are saying.
- Communication skills: The stakes in real estate asset protection are high, and attorneys should be proactive and transparent in their communication. Your interests will be better served by an attorney who picks up the phone and calls you (or at least sends you an email) instead of you having to chase the lawyer down to get updates.
Further, attorneys skilled at communication can speak to you in a way that complements your own knowledge and experience. We recommend shying away from attorneys that hide behind legalese. Not only does this behavior demonstrate a lack of situational awareness, but it can also be a sign that the attorney is less knowledgeable than they would like you to believe. - Fees and charges: Pricing for these legal services varies, and can be a delicate balance. On the one hand, you want a competent attorney with the experience to protect your business and personal assets. On the other hand, you don’t want to pay an arm and a leg. We recommend working with an attorney whose fees are commensurate with their experience and results.
Is It Necessary to Hire a Real Estate Asset Protection Attorney?
Even if you only have a single building, it is prudent to hire a real estate asset protection attorney to avoid having it attacked in a debt settlement claim or lawsuit. While you might consider a DIY approach that involves shopping around for extra insurance protection and forming an LLC, there are several planning approaches that an attorney will custom fit to your situation.
The benefits of working with a real estate asset protection attorney include:
- Get a comprehensive and robust asset protection plan
- Preserve privacy of ownership
- Avoid probate
- Facilitate multi-ownership property arrangements
How Much Does Real Estate Asset Protection Cost?
Fees for asset protection legal services can vary widely, and high fees are not necessarily indicative of an attorney that has decades of experience or achieves superior results. In addition to the legal services provided by your attorney, there will be fees for creating LLCs, transferring property, and executing transactions with foreign entities.
Setting up an asset protection trust or an irrevocable trust requires an attorney to create the trust and collect administrative and maintenance fees. To put it into perspective, these fees can range from $10,000 to $50,000 for the initial setup.
Before choosing a path, you can contact Blake Harris Law for a free consultation. We will also be fully transparent about our fees during this initial meeting.
Contact an Experienced Real Estate Protection Attorney
Even a single minor slip-and-fall case can put your real estate at risk. An asset protection attorney can help you determine the best asset protection strategy while avoiding common mistakes. To get started with a free consultation, contact Blake Harris Law by filling out our contact form or by email at Info@BlakeHarrisLaw.com.
