Posted by Mark_NY on January 16, 2001 at 20:31:24:
Steve,
I do agree with you. This DWCo just dont know what he is talking about as far as agents go.
Having a prob. with flip - Posted by Brian LI
Posted by Brian LI on January 12, 2001 at 19:14:43:
Ok here is my problem. I’m a newbie to rei and I’m starting with wholesaling as everyone suggests to generate some cash. I found a deal in my own town, which I have lived here all my life so I know the market here. I found a house 3bd/1ba in-line ranch. The owner lives out of state and has tenants. He was asking $225k for it and I got him down to $205k. It would need very little work. about $7-8k. Its worth $270k when done. As I have read, you dont need any money to put down to enter contract ($100 ernest money ) but thats it. But for some reason they want money to enter contract. Is there a way to handle this or a way around it? I’m working with a broker on this one, could that be the problem. The broker told me that I have 3 days to come up with an answer to enter contact. Someone please help me. Should I just drop the deal all together? Thanks for any help I recieve.
Re: Having a prob. with flip - Posted by dwCO
Posted by dwCO on January 13, 2001 at 20:15:33:
Yes working with agents is the problem–that’s the way they work, pretty much period and end of the story!!! Howver, the rest of the advise is good. In these circumstances, if you really have a deal here, you need to be prepared to show something—ie., cash to close or preapproval letter from a lender, even if you don’t wind up using the lender. that’s the way it usually is the agents.
Re: Having a prob. with flip - Posted by J. Clifton
Posted by J. Clifton on January 13, 2001 at 18:35:23:
In addition to the fine advice given below, I suggest:
1-Think ahead. Put yourself in the seller’s shoes, the broker’s shoes, the lenders, etc., and prepare answers for when these likely circumstances drop on you. You should pre-analyze potential scenarios to the point where you know what your stance or level of control is (or should be) for every foreseable situation.
- Offer Package. Figure out your earnest money strategy, and structure what is sent to agents to back it up. If you go with the no EMD at all approach, you may want to stick with FSBOS until you have a few deals. Then document you have closed such deals with a self-promotion sheet of “recent transactions,” that contains photos, phone numbers, etc. Submit your offers with the profile sheet and a pre-qual letter (gotten from a hard money lender) to brokers. Then they can’t say “you have no lender, no resources, no track record…” Prove that you can perform, and you can offset the flaky impression a no EMD offer gives.
Re: Having a prob. with flip - Posted by Tom
Posted by Tom on January 13, 2001 at 15:20:32:
Eds right you don’t need no money, but if you sent the deal to me, I’d send it to my seller and say: “Here an offer but the guy doesn’t want to put up any cash, I suggest you pass, he’s got no money, no lender and doubtful resouces”. It just doesn’t make you look good.
Re: Having a prob. with flip - Posted by SCook85
Posted by SCook85 on January 13, 2001 at 09:11:46:
Brian,
When you are faced with a situation like this, instead of looking at it entirely from your point of view, take one minute and put yourself in the shoes of the seller.
If you were selling this home for $205k, would you want to let someone tie your home up with nothing on the line? If this were your home and a buyer didn’t want to give you a deposit, would that make you wonder if your buyer was good? From the sellers point of view, if you had a buyer come to you with “no deposit” what reasons would you find as acceptable for them having no deposit that would still make you feel comfortable. If I were your buyer and I said, well I just don’t have the money, would you feel confident that I could come up with the other $204k plus closing costs?
Reverse roles for a moment, and put yourself into the sellers shoes, think about the home being yours and the reasons that you would accept a contract with no deposit. When you come up with one that sounds legitimate, use it.
Steve
Re: Earnest money not required. - Posted by Ed Copp (OH)
Posted by Ed Copp (OH) on January 12, 2001 at 20:44:05:
Now that being said, almost all real estate brokerage firms want some money up front. It is a “company policy” but it is Not required by law.
The reason that they want some money up front is so that they can confiscate it as commission if for some reason you can not close on the deal. There are a lot of ways to deal with this problem, the agent is rarely happy with most of them, but the agent is NOT in charge here you are.
You can make an offer with no earnest money at all, with the stipulation that you will produce money when the offer is accepted. You will need to have some money available for this, down the road if you do it this way.
You can make an offer without earnest money, and insist that the agent present it to the seller (period). I would also require that if the offer is not acceptable (by the seller) that the seller put his reasons for rejection, or a counter offer in writing.
If you have no money and are dependant on some other kind of financing, you might want to get “pre-qualified” and have a letter to that effect to send along with the offer (with no earnest money).
The agent may cry the blues but there is no law that requires earnest money, and there is a law that requires him to present ALL offers to the seller (unless otherwise instructed bu the seller). If such instructions exist ask the agent for a signed (by the seller) copy. Good luck.
Re: Having a prob. with flip - Posted by Mark_NY
Posted by Mark_NY on January 16, 2001 at 20:27:46:
This is NOT the case. I have an agent who is great! I closed on 15 acres AND got the owner to finance AND got the agent to finance her commission! So agents can be usefull. Also, I told her what I was interested in for future reference and she’s given me numerous leads.
Mark