I am a relative newbie at this but I’ll take a stab at it. First of all, unless the seller is taking a note back on the sale, are’nt all deal all cash. Even if you are getting a conventional mortgage- the seller is still recieving all cash. I think what most people expect when they see “all cash” is a quick deal.
On your second point, just because you do not want to buy their house, does not mean that you do not buy houses. Some you buy, some you assign.
Finally, You do not have to tell them that you are not interested in their house, you just have to offer them a price that would make it worth your while. If they don’t accept it, then so be it. I am assuming that any house is at least worth the land it is sitting on, unless it’s contaminated or something.
I have seen on this site that a good line to have in your ads, on business cards, signs etc is " We Buy Houses" or “We Buy Houses, Any Condition all Cash”
Here are my questions:
If you say you “Buy Houses All Cash”, does that mean it is an all cash deal with no lender involved at all?
If I’m looking to assign my contracts, would it be ethical to say in my ad that “I Buy Houses”?
If you state that you buy houses in any condition and the house is really bad how do you let the seller know that you are not interested without being too blunt?
I agree with Jack. There’s got to be SOME price you could buy nearly any house at and make a profit*. Just figure out what an offer is that you KNOW you could make a profit, and offer it. If they say no, move on.
*-(Except maybe in inner city Baltimore or other warzones where there are negative land values…but that’s another story…)
Posted by Kristine-CA on March 07, 2002 at 19:37:49:
Matt: good questions. I want to let you know that your skin will get really tough when you start making lots of offers. At least mine has. It’s been two months since I started consistently making offers. I’ve had sellers be very short or rude with me. And I am as nice as pie back. And I hardly ever say anything about the house. My offer isn’t personal; it’s based on what I am willing to pay. I don’t explain the reasoning behind my offer unless asked. Only I know what I need to do, not the seller. Don’t worry about being too blunt. Be honest with your offers and polite. That’s all that’s required.
Buying houses all cash is telling agents/sellers that you are coming in with very few if any contingencies such as needing to sell another house to buy their’s. Of course you may still have (and should) your lawyers’ contingency, inspection clause etc., but you won’t need to find financing from a conventional source so you won’t have to wait the extended period that a typical buyer would. They expect you to have your financing already in place meaning you don’t need lender’s approval to purchase.
I have begun to attach an addendum to my purchase offer contracts which allows me to attain financing even though I’ve listed the offer at all cash so long as it doesn’t interfere with the agreement i.e., I may, at my discretion choose to borrow funds from one of my lenders however I’m waiving financing contingencies which usually state that you get x days to secure a loan at x% interest with x points. Each of these x’s are blanks on a standard contract here in IL. By offering all cash this whole paragraph gets crossed out of the agreement but my rider says I can still get money from a lender as opposed to using my own funds. I’ve never had a seller balk because the time frame doesn’t change nor do the costs to him/her.
Ethical?? Not sure if there is any question about whether or not you would buy a property under the right circumstances so even if you did decide to assign every one of your contracts it could just be that none of them suited your particular needs but another investor wanted them for himself. Not a question of ethics here.
If the house is REALLY bad it’s not like you have to tell them. They obviously know. Your offer will speak volumes. You don’t have to be rude when you make your evaluation of the property so there shouldn’t be any reason they would be offended. A low purchase offer can have a proposed estimate of repairs if you’d like to make a statement explaining your reasoning for the figure but I’ve never found a situation where it was necessary. They know the property is in bad shape which is probably one of the reasons they want out in the first place.
Remember you’re in business to find situations that you can solve with any means at your disposal. You are not trying to be a counselor or dig someone out of a hole they may have put themselves into. Your job is to find these situations and find the little benefit you can bring as a service and you’ll get paid for that service.
Well technically “I buy houses cash” means alot of things. It could mean you buy houses with your cash, other peoples cash, the sellers cash - or no cash. Some deals don’t require cash, doesn’t mean you can’t do them.
Sure. You are going into contract to buy the house, but someone else ends up closing it. Same difference as long as the deal is done and the seller benefits the same.
Don’t tell them it’s bad - lower your price! The ugliest houses are the best houses. If it really doesn’t work you thank them for their time, and you tell them you just can’t help them and make yourself a profit on their home.