Need advice and encouragement - Posted by tarun_md


#1

Posted by Rob FL on February 22, 1999 at 22:18:48:

No, you can offer it on any contract form you want. You can offer it on a paper napkin and by law they have to present it.

I personally use the standard realtor contract plus my own addendum. The reason being is as follows:

  1. Realtors are familiar with it. If you present it on some strange unknown form, they will be very skeptical of it and might advise the seller to turn it down because you are trying to pull a fast one or something.

  2. The realtor contract should cover all of your local laws. In FL, we have to give lead paint disclosures, energy efficiency disclosures, radon disclosures, homeowner and condo due disclosures, etc., etc. The realtors contract covers all of this. If you just used Carleton Sheets or Office Depot forms, you might actually violate some laws and have serious liability problems.


#2

Need advice and encouragement - Posted by tarun_md

Posted by tarun_md on February 21, 1999 at 20:14:38:

About a week ago, I went to a realtor(she was not the listing agent) and asked her to pull some listings of fixer upper type properties. I decided to make offers on 4 of those properties with the intention of flipping them. I basically just offerered 60c on the listing price(without looking at the properties) and asked her to put the following conditions on the contract.

1)This offer is subject to inspections and written approval by buyer and/or buyer’s partner within 30 days of acceptance.

2)This contract may be assigned.

The realtor thought that I was wasting her time because the first condition mentioned above would take the properties off the market for 30 days. She told me that no seller or seller’s agent would take their property off the market for 30 days. She made me feel like a total idiot because she said that I was making very ridiculous offers. As a matter of fact, she called me the next morning to tell me that she is not interested in searching any deals for me and did not even write up the offers I had asked her to.
Because I haven’t done too many deals, I kind of believed her that what I was doing was ridiculous. I guess she made me loose confidence in myself, which is very important to succeed.

Can anyone please help me in structuring offers. I need help in figuring out exactly what clauses I need to put in the contract, especially if all I want to do is flip. I don’t have the ability to put $500-$1000 as earnest money. I do have some investors lined up to flip, but I am not sure of their abilities to close on the deal fast. They all tell me that they can, but its the results that talk. Therefore, I do need some time to market the properties once I have them under contract.
For how long should I tie up the property without sounding too ridiculous. What changes can I make in the clauses mentioned above to make them look more appealing to seller’s or seller’s agents?

Any help would greatly be appreciated. Some encouragement would help also.

Thank you
Tarun


#3

Re: Need advice and encouragement - Posted by RS

Posted by RS on February 22, 1999 at 11:01:03:

Your approach does need to modified in ways others have outlined. Just a word on finding an agent who will work with you. I recently found a great agent by simply calling the listing agent for a junker house I found. You’ll find if they are listing a junker, they’ll probably have others. Take those listings the Realtor gave you: look at the listing agents on each of those printouts. Chances are you’ll see the same names over and over. In other words, there may be dozens of junkers in your area but often only a handful of agents are listing them. These are the people you want to find because they understand working with investors; they do it every day and they usually have no problem submitting low ball offers because it could produce a quick sale with minimal effort on their part.After you do a deal with one of them, they’ll put you on their call list and guess who gets notified when a hot new prospect comes along?
RS


#4

Re: Need advice and encouragement - Posted by Rob FL

Posted by Rob FL on February 22, 1999 at 06:52:51:

2 mistakes I see:

  1. If the realtor knows you are making offers without looking at the property, that will make it look like you are full of hot air unless you have done some deals in the past with them.

  2. If you are having the realtor write-up your offer that is also a big no-no. Write it up yourself. I also think 30 days is too long for an inspection. Anything more than 15 (7-10 is even better) is way too long.


#5

Re: Need advice and encouragement - Posted by MaryEllen

Posted by MaryEllen on February 22, 1999 at 03:32:49:

I do not know about where you live but here the check you give with the offer is deposited on acceptance of the offer. What I am saying is, if you cannot cover the check you really should not give them one. You need to educate yourself on the property values before you make an offer. If a property is priced at 110% plus of market value making an offer @ 60% of asking price can be paying too much, especially for an investor. In my state a contract can be assigned unless the contract says it cannot be. Read your state’s offer form. If can be assigned do not put in and/or assigns which very oftern is the kiss of death on an offer.


#6

Re: Need advice and encouragement - Posted by MattB

Posted by MattB on February 21, 1999 at 21:07:26:

I’m sorry, but if I were that agent, I would probably do the same thing. Just making random offers based on nothing would make me think I was dealing with someone who was wasting my time, too. Do your research first. There are a lot of lazy realtors out there, but the one that will help you will know what sounds legitimate, and what sounds like a waste of time. I found a fantastic realtor to work with me and it’s because I have a very business-like approach. I don’t just waste a lot of his time with a lowball offer. I look for specific types of property in specific areas. I then drive by the more interesting ones. (Motivation, condition, area, price) Then I call him and tell him I want to have him get me inside to inspect. I then calculate repairs, holding costs, profit, etc. I then have him get me comps. Then we sit down and write up the offer. I have done 3 deals through him now, and he faxes me at least 20 new leads A DAY! Try a more professional approach. You may have to kiss some frogs, but, man, does it pay off!


#7

Re: Need advice and encouragement - Posted by PBoone

Posted by PBoone on February 21, 1999 at 20:56:56:

Your first contingency was perfect. Take the second one out in your future offers instead when you place your name on the agreement use your name and/or assigns
then you can assign the agreement.
1 in 95 agents are worth their salt. Do not be offended.
pat


#8

Re: Need advice and encouragement - Posted by Jon

Posted by Jon on February 22, 1999 at 10:35:53:

I noticed several of you said to write up the offer yourself and give it to the agent to present, I’m just wondering whether you have to put it on the same “85” page form that realtors use. I was told by a realtor before that they have to use their own forms, I can’t use my 1 or 2 page form, any truth to this?? Jon


#9

Re: Need advice and encouragement - Posted by Jim IL

Posted by Jim IL on February 21, 1999 at 21:23:36:

One other point I noticed in your post,
You said, "she called me the next morning to tell me that she is not interested in searching any deals for me and did not even write up the offers I had asked her to."
Don;t let her or any RE agent “write up offers” for you. Do it yourself, and then present them to the seller and/or the RE agent. This way, they are already in writing, and the agent HAS to present themn to the seller. It is the law!
And, go find another agent. As Pat said, 1 in 95 is “worth there salt”, so, go find number 95. They are out there, and I gauruntee that after you close ONE deal with that agent, they’ll bring you more.
Good Luck,
Jim