Re: New Angle - Posted by Mark-NC
Posted by Mark-NC on March 18, 2000 at 12:00:52:
In my intial conversation I tell my prospective buyer, depending on their situation I can litterally buy allmost any home on the market and put them in it with ease. And that is true If they have enough down and decent credit.(But most of them don’t)
As far as the price of the home goes yes they know what the asking price is. But what I do is look for homes that have some motivation from the sellers whether it be through MLS or FSBO. Then I will make an offer and usually the home is listed on the low side anyway so a little higher apprasial is not a problem. That is how I create the room needed to make the deal.
As far as the buyers concern I am not going to tell them what I negotiaited the price down to. If they are persistant about it I just say I got it down just far enough to make the deal work.
One of the things I find out about people that want to buy a home is the people that respond to the owner finance type of ad are either intimadated by institutional lenders or brokers or they just don’t think they can get a home other than owner financing. So it has been my experiance right from the start if you take these people and tell them “yes I can get you in a home” they will follow you to the end of the world if you can, It’s the american dream to own a home. I have had people cry and hug me at closings telling me they never thought they would ever be able to get a home.
When people call and you ask them how much money they have to work with most of them will have very little. So as far as marking the home up I tell them that I have costs involved in this transaction that have to be covered and unless they can come up with the extra cash to cover them I will have to rasie the price to cover them. For things such as closing costs or discount points I may have to pay if I am selling the financing. I bet I pay closing costs on 95% of my deals. So I just say do you have the cash for closing or discount points? They usually say no. So I say they have to come from somewhere so the only way I can pay them is include them in the price. That allways satisfies them. If they ask me whats in it for me I just say yes I am in investor I help solve peoples problems buyers and sellers and in return I make a small profit from each deal. If I didn’t I wouldn’t be in business and they accept that.
If after They have seen the property and they like it. Now comes the time to put the contracts together I get up front money from my buyer with a contract and it states the home I an going to make an offer on. It is an upfront contract that spells out the deal. I usually get at least $1000. earnest money. I tell them I need this much because I have to know they are serious about this. I will be putting my name on a contract to buy a home and resell it to them and I don’t want to end up buying the home for myself. They understand this. It is also stated that if my offer is not accepted they get their deposit back. If the offer is accepted I go into full blown offer to purchase contracts with my buyers get my apprasial and take it to closing.
Most of the deals I do are Note deals because of the simplicity and the issue with seasoned title on the mortgage side.
If you are interested in seeing some of the forms I use let me know I can e mail them.
Also as an FYI This seems to work best with properties and buyers with homes under the $100,000 range. And the average of around $65,000.