Posted by GL on October 16, 2001 at 19:01:35:
You have probably already figured this out but the clause should allow you to cancel not the seller!
Feeling Frustrated…Please Advise - Posted by Ayanna
Posted by Ayanna on October 16, 2001 at 17:55:33:
Hello everyone:
I am new to REI and I’ve decided to start with L/O. In September I got my 1st deal…or so I thought. I had the house under contract subject to my finding a tenant. The same day I found a tenant willing to write me a check, the owners called me and said they were going to sell their house to a friend!
Of course I was crushed.
This month I found another house. I was on the phone placing an ad when I received an email saying they decided to sell their house to their neighbor!
I’m wondering what I am doing wrong. Are the people I am dealing with just not motivated enough? I have been searching the papers for FSBO. Maybe I should invest in bandit signs or place my own ads?
If anyone has an idea for me to find motivated sellers, other than reading the papers, your suggestions would be appreciated.
thanks, ayanna in SF
Thanks everyone! I feel better! (nt) - Posted by Ayanna
Posted by Ayanna on October 17, 2001 at 11:48:04:
no text
Re: Feeling Frustrated…Please Advise - Posted by JT - IN
Posted by JT - IN on October 17, 2001 at 08:30:27:
Ayanna:
Congratulations on your persistence and your partial success. Yes, partial success. Look at it this way. There are many newbies who are afraid to take the steps that you have taken. Yes,you have met some feelings that are uncomfortable to you, that you are reading as failure, but I caution against that. You have succeeded in getting two sellers to go along, if only part way with you, and with the input of below, and changes that you will make, your success will be greater in the near future.
One suggestion that I have, is to increase your activity. Instead of having one deal in September, and one deal in October, try to increase the numbers of potential sellers that you are dealing with. It is a numbers game, and the more that you are able to deal with, the better. If you have 3, instead of one, then your chances are that much better. It also makes the one’s that get away easier to swallow, than if they are your only opportunity.
Again, congratulations on taking the steps that you have, and after learning how to walk, you will learn how to run. It is the same process, only based on more activity.
Just the way that I view things…
JT - IN
Re: Feeling Frustrated…Please Advise - Posted by Joe M.
Posted by Joe M. on October 17, 2001 at 02:46:39:
Just wanted to say keep your head up. sounds like you learned some valuable lessons and it didn’t cost you much so adjust and move on 
Thanks so much for the post and responses everyone, I’m a begginer and i consider this a very good lesson here i’ve learned. To all the pros that responded, I salute you!
Re: Feeling Frustrated…Please Advise - Posted by GL
Posted by GL on October 16, 2001 at 18:59:35:
You are doing a terrific job and you must be in one hot market. The houses are selling themselves!
If you really have a signed option they CANNOT sell the house to anyone until the option expires. If you contact their lawyer or title company and tell him you have a legal option, signed and dated, for which you paid, then he will immediately stop the sale until this is cleared up. If you do not know who this is, register your option on the title at the registry office or court house. In fact you should do this anyway to protect yourself.
If the price is acceptible to you, you can sell the option to the new purchaser and collect the difference between the option price and the sale price.The lawyer or title company will give you a check at closing.
Re: Feeling Frustrated…Please Advise - Posted by Terry (Houston)
Posted by Terry (Houston) on October 16, 2001 at 18:40:03:
Not for nothing but when you say you are signing them up, what does that mean?
Are you getting the Lease/ purchase contract signed? Are you having them sign the documents to escrow the deed? Are you going down and filing a Memorandum of Option?
Are you making sure that they understand this is a legally binding contract? Even if they sell the house the new owners are obligated to your lease purchase.
You do not have to push them if you do not want to but I would at least try and get back what I had put into the deal on advertisement. Sometimes it is best to back off but heck, you have rights as well as long as you document things.
If you are unsure of what I am talking about then you might try Bill Bronchicks or Joe Kaiser’s course on L/O.
They tell all and can help with finding motivated sellers.
Best of luck.
Terry
Re: Feeling Frustrated…Please Advise - Posted by Len(nyc)
Posted by Len(nyc) on October 17, 2001 at 10:03:50:
How simple is that process though, of getting paid the difference of the option price and sales price? Are you then just having the buyer pay you assignment fee with a check and then the buyer goes ahead and now has a contract with the seller? Does that mean that in your assignment contract that you have a clause that states that this money is non refundable if title is not clear? I guess im just confused about being able to write whatever clauses you want, I guess this is half because I have yet to do my first deal, as well as written my own contract. Is it possible to see a copy of the contracts you use?
Re: Feeling Frustrated…Please Advise - Posted by Ayanna
Posted by Ayanna on October 16, 2001 at 18:55:38:
Thanks Terry:
I have the sellers sign a contract with me, but they have 30 days or until I have a t/b signed on to cancel.
I initially put this clause in to protect me in the case I don’t find a t/b, but, it sure isn’t working how I thought it would!
ayanna
Re: Feeling Frustrated…Please Advise - Posted by GL
Posted by GL on October 17, 2001 at 15:43:06:
-
Contact the new buyer’s lawyer or title company. Tell them they cannot buy the house because you have an option on it. They can only buy it from you. Or have your lawyer do this.
-
Sell your option. The new buyer pays you for the option then exercises the option to buy the property.
Example: You have an option to buy the property for $100,000. The new buyer agrees to pay $120,000. The new buyer buys the option from you for $20,000 then pays the seller $100,000 as agreed on the option.
If this is not clear perhaps you need a lawyer to represent your interests. Show him or her the option and all other paperwork you have concerning the property and do it before you lose out.
Re: Feeling Frustrated…Please Advise - Posted by Ronald * Starr
Posted by Ronald * Starr on October 16, 2001 at 22:36:50:
Ayanna---------------
Congratulations–you are doing very well. Sure, you let the fish slip off the hook. As BillW and GL advise, change that hook.
You will be getting numbers 3 and 4 signed up soon, and they will not get out so easily. You might consider a clause which states that they can rescind the sale if they pay you $2,000 in cash. Then their out is still not so bad for you.
You’re like all the successful real estate investors out there. You are making mistakes. But you are doing some things right to get the deals signed up int he first place. A little polishing on that hook-contract and back out fishing.
Good InvestingRon Starr**
You left the seller an escape route… - Posted by BillW.
Posted by BillW. on October 16, 2001 at 21:30:15:
and they took it. As the other post said, the clause you use should allow YOU the escape, not the seller. The info the others gave is the way to go. Now, correct the mistake and keep trying.
Good luck,
BillW.