- April 28, 2020
- Posted by: august19
- Category: Podcast
Going into business with anyone, no matter how much you trust them, can be a tricky proposition with plenty to navigate, but there are certain legal ways of doing things that will put both you and your partner on equal footing. Joint Venture Agreements are bread-and-butter contracts for people in the field of real estate law, but many people still try to enter these agreements without any sort of guidance. Today, Chris Seveney is joined by Brian Gallagher, a partner at the law firm of Council Baradel, based in Annapolis, Maryland. Chris and Brian get into the nitty-gritty of joint venture agreements in a primer that should not be missed. If you’re looking to enter any sort of partnership, take advantage of this opportunity to make sure all your bases are covered.
Listen to the podcast here:
The Language Of Joint Venture Agreements With Brian Gallagher
I have a special guest, somebody I’ve been trying to get on, the little angel on my shoulder who keeps me in check and that is Brian Gallagher from Council Baradel who is a rock star attorney in Maryland. Brian, how are you?
I’m doing well.
I wanted to talk about a subject that’s come up a lot and that is a joint venture agreement. Brian, for those who don’t know, touches and drafts every agreement that I have or that I need to be reviewed. On the first occasions of dealing with somebody, I always have an attorney review it and I send it over to Brian, who takes a look at that and makes sure he’s protecting the interests of his clients. Brian, do you want to do an introduction on yourself?
I’ll say a couple of things here. First is you are far too kind with your introduction. Second, and because I am a lawyer, I’m going to go ahead and preface everything I say with the disclaimer that, “While I am an attorney, I am not your attorney.” You can be the audience. Everything Chris and I discuss here is hypothetical and in the abstract. A little bit about myself. I’m with the Annapolis-based law firm of Council, Baradel, Kosmerl & Nolan. I’ve been there for about a decade. I’m licensed in Maryland, DC, and Virginia. The majority of my practice is dedicated to representing the note investing community. I say it like that because the note investing community in my observation and experience is far different than the mortgage industry. What I mean by that is when you work for the big banks and you’re working with distressed assets with the big banks, it’s more of a mill situation. It’s a lot of paint by numbers. I take pride and I’m happy working with the note investing industry because of the creative way in which they approach their assets, the creative way in which they attempt to reach an exit strategy or resolution with the borrower. That’s something I take pride in is working with the investors and the borrowers in obtaining a good result for everybody when possible because it’s not always possible as Chris will know.
It seems like anytime I get a challenging case I send it your way. One of the things I want to mention before we roll into it is you mentioned the note investing community. From an attorney’s perspective, that’s one of the biggest challenges is finding attorneys who specialize with note investors. A lot of people will find real estate attorneys, which I view is far different than note investor attorneys. Would you agree with that?
I would. A real estate attorney, it can be a number of different things. It can be transactional, meaning getting deals done, buying and selling. It can be litigation, disputes over property lines, ownership, evictions, and things like that. I do a lot of that. That’s not to say that every attorney that does purchase and sale transactions is also versed enough in doing a loan modification or a workout or doing a foreclosure. You have to find the right fit for you. That’s equally the same with a lot of foreclosure firms, they won’t do the workout, and they won’t do the loan modification. You give them the file and they will run that to the ground on a foreclosure. That’s that. There are distinctions, I’m sure it’s hard for you in the note investing community to find attorneys in all the various jurisdictions that you guys have assets in to suit your needs.
That has been a challenge of mine over time. What I’ve done is as I evolve, I find attorneys that are more than one-state attorneys. I’ll try and find attorneys that do 4 or 5 states, like yourself who do three states. That way, I find it a little more simplistic in regards to doing deals in 25 states. I have 25 different attorneys. Maybe I’m down to 10 to 12 from that perspective. I want to preface that I say positive things about you because you do keep me protected. For people that don’t know, you’ve drafted, let’s say, my operating agreement, JV agreements, loan sale agreements.When you're working on distressed assets with the big banks, it's a lot more paint-by-numbers. Click To Tweet
It’s not only for a note investor, but it’s also for a note investing business, which is different that people need to understand as well as there’s that component to it that you assist with. I’m going to roll into because a lot of people have been talking about joint venture agreements. What should be in them? I’ve seen people who have them be one-page agreements and I’ve seen people have a 30-page agreement. I think that’s both ends of the scale. Mine is roughly ten pages long, which it’s not the length of it, but it’s the content that goes involved. We want to have some open discussion in regard to what should be included in some of these agreements? I’ll let you start from the top of some of these things.
A joint venture agreement, there are a couple of things to understand with them. A joint venture agreement, the best way to think about it is it is a mini operating agreement. An operating agreement is used to define how the members of an LLC are going to interact with each other and what their duties and obligations are with respect to that LLC. The same is true for a joint venture agreement. To that effect, a good joint venture agreement in addition to the basic things of, “This is how much each is contributing. This is where we’re going to use the joint venture to accomplish.” It also needs to address the buy, sell situations. When I say buy, sell situations, what I mean is how you get in and out of the joint venture agreement. In the perfect world, you get into it by both parties contributing what they’re going to contribute to acquire the asset, to manage the asset, dispose off the asset, then everything’s done and the funds are distributed.
The joint venture is over, but things don’t always work that way especially in the note investing world. There is a myriad of things that can happen to throw a wrench in the plans. When those things happen, the parties need to understand what their rights and obligations are in terms of maybe somebody wants to get out of the joint venture. Are they allowed to get out of it? If they are allowed to get out of it, how does that go about happening? What if neither party wants to get out of it but they are stuck at an impasse? They can’t agree on a major decision to be made. What happens then? Those are things that need to be thought about and need to be addressed when drafting a joint venture.
One of the things I’ll use a caveat to is whoever’s drafting this, it shouldn’t be you, in the sense of people reading, if you’re not an attorney, you should have an attorney draft this. In these, a lot of the basic things like, who are the parties? A sponsor is a person who’s bringing the deal and the investor is the one in the note space typically who’s bringing the cash to the table. Most note investing JV deals, the investor brings 100% of the capital. The sponsor is the one who’s managing the assets. Some of the basic stuff like knowing what are the parties, what is the asset that’s going to be included, the roles and responsibilities, that is key.
There’s also making sure that it’s not considered a sale of a security where you’re guaranteeing a return. There needs to be some involvement from both parties as part of this deal. When deals go smoothly, the JV agreement is okay but it’s only when things go upside down is when you need to have all these little, I call them caveats, but contingencies in the agreement. Such as if somebody wants to get out, is there a penalty? One of the things that I see people struggle with is, honestly, Brian, how is the pay structure done? People will be like, “Somebody contributed $20,000 and the borrower pays $1,000. How does that get dispersed?” Simple things like that I’ve seen go awry in that sense. One of the other things that are important is, outlining the roles of the management focus. I view that is two components. There’s managing the ancestor itself, but managing this mini operating agreement or the deal itself for communicating. In ways of like, “What is the reporting process? Are you reporting to this person daily, weekly, monthly, yearly?” some of those things as well.
You hit on this, the overarching thing to understand when you’re doing a JV deal is you have to give consideration to whether this is an investment. The SEC and whether something is an investment in the JV world, it’s the boogeyman. We know it’s there. You think it’s there. You’re sure it’s there, but you don’t know what it is. The SEC or the courts have defined what an investment is. The standard for determining whether something is an investment is whether you intend to make money solely off of the efforts of others. You are going to give somebody $1,000. You’re not going to do anything. In a year’s time, you expect to get back $1,500. That is an investment. With a lot of JV deals, this is a problem and it is an investment is when you’re going to take money from somebody and then in the deal, you tell them you’re a silent partner.
I’m going to make all the decisions. That’s an investment. There are legal considerations and business considerations when you’re drafting a JV agreement. My biggest concern when drafting a JV deal is to do everything that I can to ensure that when somebody reads this, they don’t believe that this is an investment. What that means is that when I draft this, I try to make crystal clear, one, by saying this is not an investment. Two, by giving the person you’re JV-ing with a real, actual duty, obligation, and opportunity to participate meaningfully in the management of the asset. That means that they are not expecting to make money solely off of the effort of others. The analogy that I use is if you’re going to invest, if you’re going to give money to Vanguard or T Rowe Price, you can’t call up the chief investment strategy officer and say, “Solar is about to get hot. Let’s move some money that way.” You can, but he’s going to laugh at you. He doesn’t have to do anything.
When you’re in a JV deal, your JV partner should have the opportunity to say, “I understand this person is in default. They haven’t paid for a little while. Let’s talk about what modification would look like and what we would accept as a modification or what we wouldn’t accept? Let’s talk about what a foreclosure would look like.” If it’s going to foreclosure, that JV partner has to have the real and actual opportunity to discuss with you, “What’s going to be our starting bid? What’s going to be the bottom line that we’re going to allow this to sell for?” Those are different than T Rowe Price that decides when they’re going to get out of it. You can’t call them and say, “When the price of Google hits $200, we need to buy or sell.” Those are some things to consider. That’s my biggest heartache and my biggest concern when I’m drafting these agreements is to stress that this can’t be an investment.
Let me ask this question to you because this gets posed to people. The agreement states that the investor has, I’ll call it this duty that they’re part of the team. If they choose to stay silent and if you’re reaching out to them, saying, “The borrower hasn’t paid in 90 days. I’m going to send a demand letter. What do you think?” You pick up the phone and call them if they’re nonresponsive to you, you’ve given them the opportunity but they’re not using it, is that okay in that sense?
The onus or the liability is on you. The liability is not on them. The liability for this being an actual investment is on you. As long as you are doing things that prove that your intent was not in taking an investment, that it is in having it partner to assist in the management of this deal, you’re doing the right thing.
From my understanding, it’s the decision-making process. If you have a performing note, you have a duty to report to them the information and so forth, but there are no decisions to be made. You keep them informed in things, go on their merry way, and then when it turns sideways on you, that’s when it’s like, “You bring them involved.” You always want to keep communicating with them, but in those times when decisions are being made, that’s the biggest effort where you should be reaching out to them to bring them in the loop.
That’s something that I always explicitly like to see in the operating agreement is that if something’s going to be reclassified from performing, nonperforming, there needs to be a discussion and a joint decision made.
What happens if you’ve got a borrower, the 93-year-old little old lady who goes 90 days behind and you tell your joint venture partner, “Little Mrs. Smith is behind. We’re going to defer.” The person comes back and says, “No, I want you to foreclose on them, screw them.” You’re like, “That’s not in our best beneficial interest to foreclose because the house might be upside down and it wouldn’t be as profitable.” The person is like, “I don’t care. I want to foreclose on this person.” What would happen in something like that?
There should be language in there that deals with when you are at an impasse and typically that is what invokes a buy-sell provision. You hear a lot about buy-sell. What does that mean? It means that when you reach a point with a partner where you can’t move forward because you’re at an impasse or a deadlock, are you going to sell your interest to them? Are you going to buy them out? It’s that whole process. That in and of itself and how that is written is more of a business decision than it is a legal decision. In order to understand how you want that to work and your joint venture agreement, it’s a business decision. Are you in a position that if you get to that point and there is an impasse, do you want to say, “We’re at an impasse. We’re refusing to move forward. We’re going to sell this entire asset to somebody else and we have to sell it to the highest and best bidder within 30 days. We’ll distribute the proceeds of that sale in such and such manner?” Does that work best for your business model? Does it work better for the business model that you have an opportunity to buy that person out? You coordinate how you guys are going to reach that price of the buy-sell.The best way to think of a joint venture agreement is as a mini-operating agreement. Click To Tweet
One question that comes up a lot is in contracts including these agreements, if there is a dispute, it is settled and it’s based on the laws of a certain state. The question comes up, should it be the state that the sponsor is in, the state the investor is in, the state the asset is in, the state that your attorney is in? All four of those could be different. What would you respond to that? What would you recommend to somebody?
Generally speaking, the way the courts are going to interpret this is a business deal. This is not a consumer transaction. The courts are going to interpret you, everybody as a well-heeled businessperson that is capable of making their own business decisions when entering into a contract. What I mean by all that is you can pick it to be whatever you want it to be. Let’s say that the property is in California and the joint ventures and you were in Florida and your partner is in Maine. What are you going to do? Maybe everybody decides that if there’s a dispute, it’s going to be settled jurisdictionally in accordance with the District of Columbia Law. You’re going to use District of Columbia Courts, DC Law, and that’s where it’s going to be settled or you’re going to say, “No, you can’t go to court. This is only subject to binding arbitration.” That arbitration is going to take place in the jurisdiction of your choosing by following the laws of that jurisdiction, by following the rules promulgated by the American Association of Arbitration.
For me, and I can say this because I’m not the attorney, I have it written in mine for the state where my rock star attorney is located because he’s the one that wrote the agreement so then I’m going to put him to the task of defending it. Speaking about writing these, when somebody is entering into and if I’m an investor and the sponsor sends me this, one of the first questions I ask is, “Who drafted this agreement?” People sometimes get hesitant, they’re like, “None of your business,” type of thing. I’m curious, I view it as, “I want to know from your professional opinion when you review these, do you like to know where they come from?”
The reason I like to know is there are a couple of different reasons. One, first and foremost, sometimes you want to know where it’s coming from. Did a person pull this off of the internet? Did they have an attorney write it? When you’re reading it, sometimes it makes more sense to you if you understand an attorney wrote this versus they pulled it off the internet. It may or may not be relevant to what we’re trying to accomplish here. If an attorney wrote it, sometimes you give a little bit more deference to things. What I mean by that is I don’t mean that you take their word for it, nor do I mean you review it even harder because you think that an attorney is trying to be slick and slide something by you. You need to understand where it came from. It helps you review it a little bit better.
The other thing too is this happens a lot. I get clients who will call me up and say, “I need you to review a contract. What’s the flat? What’s it going to cost me? Can you do it for a flat fee of $250, $500?” If a good attorney wrote it on the other side, “Sure, it’s probably easy to review it for that much.” If they give you something that a non-attorney drafted that has never done this before, it would cost you less money to have your attorney redraft the entire thing from starting because they probably already have a template that they’ve used in the past. They can edit for your purposes.
We’ve seen that on loan sale agreements that you and I have done where the loan sale agreement comes through and it was clearly defined that it wasn’t from an attorney. I remember going back to them and saying, “Here’s one for my attorney. Can you take a look at it versus using the one that you had?” They agreed. That’s a good point there.
The thing to keep in mind regarding most of these things is that people are committed to getting a deal done and they want to find the path of least resistance. Asking them these questions and letting them know, “I’m committed to try and to work this deal through. We’re trying to find the path of least resistance here. Help me out. Let me know a little bit of understanding of where this agreement came from.”
I wouldn’t be too trustworthy or feel confident sending somebody money who won’t even tell me where stuff comes from. From my perspective, I’m looking more for transparency from somebody. How many I’d say note deals can go bad and when they go bad, people can potentially lose money on them? That’s part of the risk of the business. Have you ever defended anybody because there was a JV deal, a note deal where a person lost money because of that versus the person not doing something that’s dictated in the agreement, that they should have done and caused heartache or were they completely incompetent and weren’t doing anything?
I haven’t seen any JV agreements or loan sale agreements. I haven’t seen any lawsuits arising solely out of those yet.
You’ve been doing this for how long?
For years. The only times I’ve seen JV agreements or loan sale agreements litigated is when it’s tangential to another issue that’s been raised. For instance, a borrower is suing the current note holder for an alleged RESPA violation. The loan has been assigned a couple of times, people are arguing over what was represented and warranted in the loan sale from the predecessor in interest.
A lot of people should understand we’ve all had deals go bad. My recommendation is to follow what’s in agreement and at the end of the day, someone can sue you for anything. It was Warren Buffett or somebody who said, “Somebody can sue you for anything. You can always get sued, but you shouldn’t be losing.” Something along those lines is, do what you should, do not lose.
I’ve been involved in countless disputes regarding loan sales. Everywhere from huge funds that I’ve represented that are buying thousands and thousands of loans at the same time, all the way down to a person buying a single loan from a seller. I’ve been involved in countless disputes over, “What you sold me, you need to take this back,” whatever the case might be. Virtually every single one of those situations, they were able to reach a resolution. That’s because, in this note industry, people try not to get bogged down on things. They view it from a business decision. How much is it going to cost me to fight this? Do I want the press that comes along with fighting this? Your industry is small. If you get the reputation of somebody who is a pain to buy notes from or to sell notes to, people are going to stop selling or buying from you.
This is such a small little niche industry and your reputation is huge. From that, you want to make sure that you do the right thing, the way I look at it. If there’s a dispute, you need sometimes to flex your muscle a little bit to make sure you’re defending yourself. At the end of the day, you’ve got to be careful that, “It’s going to cost me $10,000 to fight this thing and we’re fighting over $3,000?” It’s dealing with a borrower and the Cash for Keys for $3,000 even though you hate giving them any money but it’s going to save you in the long run. Any lessons learned from JV agreements or things that you’ve seen that have caused you to shake your head may be that you’ve seen from people? Any crazy stories with JVs out of curiosity, if there have been any lessons learned? In such a small business industry, I’m not sure if there are a lot of stories out there.If you're at an impasse with your partner, you should have a language that invokes a buy-sell provision. Click To Tweet
I don’t want to use examples because it is a small industry and I don’t want people to get hip to what I’m talking about. Doing a JV deal is like dating. Trust your gut. If you’re trying to work out a JV deal with somebody and you get the impression that, “This person is going to be a giant pain in the butt to deal with or this person is a little bit too slick for their own good. Do I want to continue dating this person and to get in a relationship with them?” Trust your gut. I do it with clients all the time. There are plenty of people that call me that want results that are outside the realm of possibility. I don’t want that person as a client. Don’t be desperate for a JV partner or a client from my standpoint that you’re willing to take anybody and everybody.
Here is a perfect example. I’ve gotten out of JV agreements and run everything within funds. The progression of note investors that they try and get is, “Let me get out of these JV deals.” Because of some of the inherent risks that somebody files a complaint with the SEC because they think he did something wrong and then you have to defend it with a fund. You’ve got the paperwork and everything already submitted in that sense. I had a conversation with somebody interested in credit investors, interested in some funds down the line and stuff. A conversation went on a little longer than anticipated. I had told them, “I’ve got a hard stop at this time.” We do a hard stop. It’s like, “Can you send me some information and so forth and follow-up phone call?” I was like, “I’ll send you information, I’ll follow-up phone call, but it’s going to be a few days.”
The guy calls me early in the morning. I didn’t answer it because I was having breakfast that’s how early it is and I’m an early morning person. They also sent me a text like, “Are you going to send me this information or not?” That’s the thing where I look at it and be like, “I’m done.” I’m already like, “I can tell this person is going to be such a royal pain in the ass.” For people reading who are getting started, the few times you do with JV deal, which I highly recommend you buy other notes and know their process before raising money.
From that standpoint, you’re excited when you’re like, “I got a JV, I got somebody to fund a deal.” You’re ecstatic. You’ll take anybody like what happens to a lot of people. I look back and I’ve had more than 50 different people probably, and there’s a handful that I’m like, “Thank God I got rid of that person,” from that perspective. One question I wanted to ask you popped in my head with these JV deals. Sometimes there are people who have never done a note deal and they’re doing JV deals and stuff. Would somebody like that have any liability for not being experienced?
Those situations make me nervous. I can’t agree more with what you said, Chris. You’ve got to know what you’re doing before you go out there and try to jump into JV deals.
I have language in here that states, “People are going to hold me harmless unless I’m willfully negligent or reckless or fraudulent.” Could somebody argue that’s reckless right then and there by doing this?
No, not if your JV agreement is written the right way. If it’s written the right way, it is a joint venture where you are jointly doing something. It’s different if you are running a fund and you are soliciting money from people based on representations that what you’re doing when in fact you don’t know what you’re doing. The reality of the situation is if you don’t know what you’re doing and you’re doing joint ventures, it’s more likely to lead to problems. What exactly are those problems going to be? They could be a myriad of different things. If you know what you’re doing, you have the experience, and you can answer all the questions that arise, you’re in a better position to succeed and experience fewer problems with your joint venture.
We could have a whole other subject on vetting people that you should be doing business with. One thing that comes up a lot, too, is people ask this question, “How am I protected?” Nothing is getting recorded, it’s a contract. What I tell them is, “It’s like any other contract you sign.” If you have signed somebody to drive while you’re at house, there’s nothing recorded there. You have a contract with them to fulfill an obligation. If they don’t fill it, then you have to go down that path. People sometimes think, “That note the mortgage is getting assigned to you, how am I protected and stuff?” People ask about putting their names on assignments. For me, I tell people, “If you want to, fine.” Back to that comment you made, if a borrower starts saying RESPA violations are being claimed, they’re suing everybody who’s on that assignment chain and it would include you as well. That’s more of a business decision, but I’m curious because that question gets asked a lot. How do you respond to that if someone says, “How are they protected?”
Is it any different than if you are a minority owner in Wendy’s franchise? Is anything recorded for that? No, it’s a contract. It’s the nature of things.
You want to make sure the person that you’re entering this contract in is somebody who you want to do business with. That’s another component to this like you mentioned is clearly spelling out who gets paid? How much they get paid and when? That’s something that I see gets disputed a lot in regards to deals, especially the ones that go hairy. When I say hairy, it’s the ones that the investor put up $20,000, the sponsor ended up putting $4,000 into the deal and at the end of the day, you lose money, you sell it for $20,000. How is that dispersed? Does the investor get their $20,000, the sponsor loses $4,000? That’s something you want to clarify.
That’s why you have to be an experienced note investor to get into JV deals because only if you’re an experienced note investor, you understand how notes cashflow. Do you understand how realistically you can expect proceeds to come in? What is going to have to be paid out of those proceeds or the actual owner of the note sees a dollar? If you’ve never done it before or if you don’t understand how the cashflow of a note works, how are you going to successfully write a JV agreement cashflow waterfall that accomplishes your business goals? That’s what I tell people a lot is I can give you some examples of how some waterfall distributions work and JV agreements that I’ve done or operating agreements that I’ve done for LLCs but that’s a business decision. Those things they’re not a legal decision, they’re a business decision. You have to make sure how that happens fits into your business plan.
That’s where I tell people, “Be cautious when you get a JV agreement from somebody else.” I’ve dealt with people who worked with me and they’ve turned around and taken my agreement and used it when they get experienced JV people. I’ll mention this, mine is unique and I know you at first thought like, “Are you sure that you want to do this?” In regards to that payment structure, which is, all the money that comes in upfront online goes right back out the door. I don’t take any of my profits split early on. Somebody paying $400 a month and that’s interest. If it’s a 50/50 split, what people do is, “You get $200, I get $200.” They start collecting it at that point in time.
The way my deals are written at that $400 comes in of that interest. I’m dishing that back out to the JV. I can do that because I work full-time and I don’t need this income to put food on the table. On the flip side, if this is your full-time gig and all of a sudden you took my JV agreement and started using it and didn’t read it, you’re looking at it and the person is like, “Where’s my money?” It’s like, “Half.” I was like, “No, the agreement doesn’t say that.” Each agreement is specifically catered to the investor. That’s why you can’t take one. Even if it’s written by an attorney, you still don’t want to take it off the shelf.
There are plenty of times where I’ve made a suggestion to a client. They say, “I don’t know, can you suggest a waterfall to me?” I’ll say, “Here’s one that I’ve used for other people in the past.” They’ll look at it and they’ll be almost offended by it. This is a business decision. What is your business model? What is your business plan? Yours isn’t what this last person was.People are committed to getting a deal, and they want to find the path of least resistance doing so. Click To Tweet
There are many nuances to these agreements that you’re right, there are many business decisions. It’s no different than you’re writing documents for a fund. My PPM documents and somebody can’t take that and copy and paste it to somebody else because how I structure everything versus how somebody else structured it is completely different.
With JV agreements, fund agreements, operating agreements, there’s a lot of template language. That is standard. It’s going to be there no matter what but there are the places that are not template language are generally the most important places that need the most thought and take the most time for a business to decide how they want to operate.
One thing I wanted to mention because I don’t know anybody else that does this. You recommended it to me and I did it and got to get a few of them done. When an asset is liquidated, I don’t know anybody else that has a cancellation of, “Our deal is done,” type of thing, a termination agreement for the JV. That’s one thing that is important because you paid somebody off, two years later, they could come back and say, “You still owe me $3,000.” Do you see a lot of people doing that?
I don’t see a lot of people doing that. It’s a good thing to consider especially if your JV agreement is a finite thing. Regardless of whether you have an official document or not, it’s always a good business decision to have in writing between two parties, “We’re good. We’re done. See you later.”
I’ll be honest, I’ve dealt with some partners who they’re a little scatterbrained and I’ve had them sign the document that I had you draft and they came back months later. It’s like, “Where’s the final $4,000 on this?” I’m like, “I sent that to you three months ago and I had you signed this thing saying you’re paid in full.” “Can you resend that to me?” “Yes.” It’s something that if you ever have to pull it out and probably the one time I’ll ever have to do it, but at least I had it at that point in time if they’d have to spend 1.5 hours trying to dig through emails to find it. One thing I want to wrap up with Brian, we talked about JVs. This is something you draft pretty much any type of documents overall between JV agreements, PPMs, loan sale agreements, any type of agreement within the note space you’re available to draft for people, correct?
I help people with all those things.
For people who are interested in Brian’s services, what’s the best way for them to reach out to you?
Give me an email or a phone call. It’s (410) 268-6600. Shoot me an email at Gallagher@CouncilBaradel.com. I’m on Facebook. I’m in all the different note investing groups. You can look me up or Google search me on the internet. Our firm has a website and you’ll see me there.
One of the things also that I respect as well that sometimes gives when you’re dealing with attorneys and notice knock on attorneys, it’s like dealing with architects. If they’ve never been in the real world, they can design the prettiest building or an attorney can draft the greatest agreement in the world, but it’s not viable. One of the things with Brian is he is also a real estate investor. For people out there, he invests as well. He sees both sides of it, probably wouldn’t want to be on a dispute on his other side on trying to defend it. He has real firsthand experience in that. That plays along with ways, the agreements.
When I’ve always had the conversations with you is this needs to be fair. It needs to protect your interest, but it needs to be fair to both sides of the parties. It can’t be a one-sided agreement because at the end of the day, it’s contested. You might get shredded. That’s one of the other reasons why I enjoy working with you is because it also relays down to the people who work with me that they have that understanding that, “Yes, this is fair.” When they’ve had their attorneys review it as well. Brian, thanks for joining us. Any final thoughts before you run and take care of all the little ones?
I looked up the quote and it was Plato who said it in 500 BC. “These are strange times in which we live.” I don’t think there’s any truer quote then it is now, “These are strange times in which we live,” especially in the note investing world. There’s going to be plenty of opportunity for note investors in the coming years based on what’s happening. Chris and I talk about this all the time, the most successful people ascribe to the maxim of pigs get fed, hogs get slaughtered. You don’t have to make every single dollar on every single deal. There are going to be a lot of considerations that have to be given moving forward, coming out of this time. Give it some thought and everybody will be okay.
I always put myself in someone else’s shoes as well and try and work with people as much as possible on this because this is going to be trying times. It’s the need to help. My philosophy has always been, “I try and help the people who want to be helped.” The reality is there are a lot of people out there who want to be helped. I try and work with them and help them. At the end of the day, it has a positive social impact on it as well. From a business perspective, it can also be more beneficial. You will always have these borrowers who don’t want to be helped. Unfortunately, there’s not much you can do in those instances. You’ve got to try and if you can’t and then you can’t. Thank you, Brian, for joining us in this episode. Everybody, take care.
Love the show? Subscribe, rate, review, and share!
Join the Good Deeds Note Investing movement today: