Most borrowers send their loan documents to their attorney for review. After your attorney goes back-and-forth with the bank (or the bank’s attorney) several times to massage the paperwork, he or she calls to inform you that the documents are ready to sign.
This is not the way to use your attorney. Instead, follow these steps:
1. Instruct your attorney that after he or she reads through the documents, you want an itemized list of every concern that the attorney has.
2. Thrash out with your attorney which issues are deal-breakers, which issues are important (but not necessarily deal-breakers) and which issues are less important.
3. After negotiation, your attorney delivers a report to you with the negotiated outcome of each area of contention.
4. You decide if you can live with the deal or not. You may need to personally get involved to discuss deal-breakers with the bank.
5. If you can’t live with the deal, talk to another bank. Tell the new bank about the deal-breaker as well as every other point in the negotiation. Cut to the chase. Ask them if they want to play under your conditions.
If you don’t follow this process, your lawyer will use his or her judgment in deciding whether to fight or to agree on any particular point. Relying on your lawyer’s judgment isn’t a bad thing. But, I have had many situations where clients tell me they never would have signed the agreement if they knew a particular obligation was included.