Letter of Intent OR Full contract? - Posted by Eric


#1

Posted by Tom Brown on October 20, 1998 at 15:23:49:

Personally, I think the full contract is better. If your offer is accepted, the contract can be signed immediately. Less time for seller’s remorse. Plus after you get used to it, full contracts don’t really take much more time than an offer letter, and probably in the long run save time.


#2

Letter of Intent OR Full contract? - Posted by Eric

Posted by Eric on October 20, 1998 at 14:59:16:

Letter of Intent OR Full contract?

Which do you pros suggest?

Seems like a contract will indicate youre more serious and the earnest $ may help the offer.

Any feedback is appreciated!

Eric


#3

Re: Letter of Intent OR Full contract? - Posted by Brandi (TX)

Posted by Brandi (TX) on October 21, 1998 at 24:47:22:

Eric -

If you are dealing directly with the seller, I would suggest a full contact, since you allready have a good idea of what they are willing to accept.

If you are having to go through their agent, I recommend a letter of intent. Keep in mind that a letter of intent can have multiple offers that are not in too much detail, but specific enough to tell them what you are willing to do.

I have been writing 3 offers per letter.
#1 What I will give them in cash.
#2 Another method I am willing to do.
#3 Yet another I am willing to do.

I think this is very powerful, because it puts them in the mind set of having to choose one of these 3 offers. Of course I make sure I am ready to do what ever they choose, and always make the offer contingent upon SOMETHING - so I have a way out if need be.

Please let it be known that I am VERY new to this RE game. But so far it is fun!! I make offers a lot. Even though none have been accepted yet, I have received counter offers and intend to write contracts on 2 deals this week. (Not bad for less than a month’s study!)


#4

Re: Letter of Intent OR Full contract? - Posted by L.A.

Posted by L.A. on October 20, 1998 at 22:36:10:

I use letters of intent, all of the time & have no problem.
I deal with motivated sellers & r.e.o institutions also.
Never had a problem with any of them; besides I can make more offers & don’t have to put up a penny of earnest money in the process of using a letter of intent.
If they agree to my letter of intent…THEN I write a contract…but only then.

Just my .02


#5

Re: Letter of Intent OR Full contract? - Posted by Mr Donald (NORVA)

Posted by Mr Donald (NORVA) on October 20, 1998 at 16:34:44:

Eric,

Written offer in the form of a full contract, preferably your own, and not one of those “standard” Realtor forms.

Earnest money does necessarily have to be substantial, as you can stipulate that you have to deliver the contract to YOUR settlement agent with your earnest money within X number of days.

That should give you more than enough time to raise the cash needed for earnest money - although you really shouldn’t be giving anyone over $1000 for the deposit, unless you’ve got access to a lot of liquid funds.

Try for $100 first, counter at $500, and never exceed $1000. Usually if its a rental property that is occupied, I’ll get the lower end for the deposit as I’ll say “It’s occupied, you’re collecting rents until settlement, your risk is minimal”. If it’s vacant, I’ll settle on the lesser of $1000 or an amount equal to either the monthly rent or mortgage payment.

Mr Donald.