newbie question about agent protocol - Posted by james

Posted by Ken (Fl) on September 20, 2004 at 10:21:17:

The seller amends the contract not the agent. The agent may suggest an increase in earnest money but it is up to the seller.

newbie question about agent protocol - Posted by james

Posted by james on September 17, 2004 at 22:43:52:

Just starting out RE. I feel that due to my lack of funds and time currently ( in a recent accident- his fault) I am going to aggressively educate and use realtors to “help” find deals. THis will not be my only source of “finding the motivated seller” my reasoning is that the more people working in my favor the better leverage I have. Yet I digress.
when my buyers agent finds me a property of my liking the sellers agent will need to see proof of funds from a lender. MY question is: Will this proof of funds come from my buyers list or will it have to come from me? I am thinking the former because I know for sure that I can not get approved for a mortgage. If this is true. Than I need to line up hard money lenders in conjunction with using agents. Please help.
thank you in andvance for answering.

Re: newbie question about agent protocol - Posted by Ken (Fl)

Posted by Ken (Fl) on September 18, 2004 at 10:04:20:

You will need to show some proof of funds for yourself. Even if you assign the contract to another buyer, you are still responsible to ensure the contract is executed. This could mean you purchase the house even though your buyer has failed.
You will more than likely need some earnest money as well. We all would like to keep that amount to the minimum but a good RE agent will be spooked if the amount is too low. Sometimes the agent will use the earnest money to flush out a less than capable purchaser.
With this said, it is still worth perusing.

Re: newbie question about agent protocol - Posted by Yolanda

Posted by Yolanda on September 18, 2004 at 17:50:31:

Sometimes the agent will use the earnest money to flush out a less than capable purchaser.
WHAT??? I got lost there. Will you please explain further?

Re: newbie question about agent protocol - Posted by Tom-FL

Posted by Tom-FL on September 18, 2004 at 21:49:59:

A less than capapble purchaser would not be willing to put up more than a few hundred earnest money.

An agent can call his bluff by demanding, say, $5000.

Re: newbie question about agent protocol - Posted by Kathryn

Posted by Kathryn on September 19, 2004 at 22:44:44:

I did not think that I am less than capable purchaser…I have found that all realtors demand $1,000.00 binder and the one I work with now, will take a deposit ONLY if my offer is accepted. I do this because I put in so many offers, that I will not be able to put $1,000.00 each time, whether it is accepted or not. The $1,000.00 deposit is an amount decided by the realtor’s broker and seems to be common throughout most real estate offices. Now if you are speaking “outside” the realm of using a real estate agent, I have just recently tied up a deal with $5.00!
I am very capable of paying for this property as well as going through with the closing. There are many people who put up $1,000.00 and do not go through with the closing. And most of the time, the money gets split between the broker and the seller. So in essence, the higher the deposit, the more money the broker gets to keep if the buyer backs out. Unless the home is over 300k, if a real estate agent demands $5,000, I would submit a contract through another agent and call this agents broker. My advice Yolanda, go find a HML (he may even give you the 1k) and he will give you a proof letter to submit with all contracts, and try to find a good realtor who understands what you are trying to do as an investor. Get the deal first and then work on either wholesaling or retailing it to an end buyer. Only then can you get the “deposit money” back as well as a nice profit.
Also, in my hot market, if an REO is under 50k, you only need a $500 binder. Good Luck

Re: newbie question about agent protocol - Posted by Stewart

Posted by Stewart on September 19, 2004 at 18:08:29:

Can the agent really demand though? Doesn’t the person with the offer make the deal and say this is it? The agent has to present all offers, correct? I realize reality and practicality aren’t always the same thing.

Re: newbie question about agent protocol - Posted by Ken (Fl)

Posted by Ken (Fl) on September 20, 2004 at 10:30:34:

You seem to have taken Tom’s comments personally. You are in a different situation. You have given your agent good reason to do business with you in a different manner than a first time buyer. Also the perspective given is from the seller?s side, not the buyer?s side.
If you had a buyer sign an agreement on your property, wouldn’t you want the buyer locked in as much as possible? There are no guarantees; I watch a couple give a 5K deposit because the husband was too embarrassed to tell his wife they couldn’t afford their dream home. But as the seller, if the buyer is reluctant to make a significant commitment to the agreement, wouldn’t you wonder why? Usually (not always) it is a lack of funds.

Just my thoughts.