Guideline # 19: Read the fine print.
Read the fine print BEFORE you get to closing. Insist on being provided copies of the documents you will have to sign prior to the day of closing. Read them and understand them. Never forget Guideline #10 (these are business relationships, not friendships).
Have we always done this? No. That's why this is a guideline!
We once signed mortgage papers that contained a "yield maintenance" clause. It was fairly technical. We did not understand it. We did not ask our attorney's opinion. We just assumed it was a form of a pre-payment penalty. Yeow! Think pre-payment penalty on steroids. At the peak of the late-and-not-very-lamented real estate mania (very late in 2006), we had the opportunity to sell one of our larger investments at what we thought was a VERY good price. When we called the mortgage broker asking about the pay-off of the +/- $4,000,000 loan, we were advised that in addition to the loan payoff they would be expecting the yield maintenance payment of just shy of $500,000. Oops. We declined to sell. All in all, it was not a bad thing - we still own the asset and are very happy we do, but we felt a tad foolish for not knowing.
We have signed many mortgage documents that contain language giving the lender the right to ask for an appraisal. We now have a more thorough understanding of what that clause is for and what it can mean. After the retail real estate market imploded in 2007-2008, one of our friendly lenders send a very shell-shocked appraiser to look at a strip center we had developed about three years earlier. Said appraiser determined that our property was worth about two-thirds of the value we were supposed to have to support the loan we did have. This is known as a bad thing. The friendly lender asked for a meeting and suggested that it would be a good thing if we provided them with either cash or other collateral for the "missing" one-third of the value. Let me tell you....that hurts. Never missed a payment. Never late on a payment. Still in "default" because of the appraisal.
Read and understand what you are signing. Please.