Stupid Realtors - Posted by Chris

Posted by bmeesh on March 22, 2006 at 20:04:08:

Wow…this is the second stupid comment today about realtors that I have read…I am a realtor…i am not stupid:) I have dealt with realtors that are uneducated in creative financing but may be decent realtors and not stupid. I too have had realtors that won’t ask about seller financing or lease purchases…I am wondering currently if a realtor that I was working with on something even presented (and all offers are to be presented) my offers…due to ethics i have to be careful on how i may approach it with the seller, but i am also a consumer.

Stupid Realtors - Posted by Chris

Posted by Chris on March 20, 2006 at 19:16:17:

I hope my subject title cought your attention. i was talking to a realtor today trying to brainstorm creative financing on a property i’m interested in. i mentioned assuming the owners loan and paying the difference. she then told me that most of the time banks dont allow that anymore. what gives? i read about people assuming loans and buying “subject to” on this website a lot. do i need to contact the owner directly or is there truth to her words? What would YOU do??


Re: Stupid Realtors - Posted by Ed Garcia

Posted by Ed Garcia on March 21, 2006 at 11:43:52:


Real-estate agents for the most part are good people who are order takers not real-estate sales people. When is the last time you truly saw an agent sell a property rather then just introduce you to it from the multiple listings?

Real-estate agents day in and day out deal in retail sales, so where would you expect their mentality to be, retail sales of course. If you should tell them that you wish to purchase a property at 50% they will be the first to tell you that, that?s unrealistic.

In their world they can?t comprehend buying at 50 cents on the dollar.

Their idea of creativity is asking you for a pre-approval letter from your mortgage broker.

They also will tell you that they have a fiduciary responsibility to the seller which is true, but shouldn?t prevent them from being creative. The main reason they?re not creative is because the market has been hot and they would rather wait for conforming qualified buyer then to do what it takes to create a sale. When the market cools and it becomes a buyers market not a sellers, you?ll be amazed how creative they become.

Enough said about discrediting realtors, lets talk about remedies of the problem at hand.

Is the real-estate agent technically correct when this was said ?she then told me that most of the time banks don?t allow that anymore,? referring to loan assumptions.

It?s been that way for along time and yes, we as investors circumvent this issue all of the time. Depending on the loan, some can be assumed for 1% and approval by the lender and the ones that can?t we as investors take a chance on knowing the worst thing that could happen is we activate the ?do on sale? clause which is a rear incident.

In the event we do activate it the worse case scenario is we refinance the loan.
In most cases lenders won?t hassle you if the loan is being paid as agreed. They?re too busy collecting the bad guys who don?t pay, rather then spend their time and money chasing current accounts.

In the future I suggest you learn how to circumvent your real-estate agent. You do this by requesting a meeting between you and the seller. If the agent tells you to give them your questions for the seller and they will pass on the information. Tell them no thank you, that you have a policy that you meet with the sellers when purchasing property. If the agent tells you the seller will not meet with you, then tell them to show you another property. If the seller is not motivated enough to meet with you, then they are not going to be motivated enough for you to make a good deal. If the agent wants to be present when you meet the seller, unfortunately it?s appropriate so you?ll have to go along with it.

When meeting with a seller always, I?ll say it again, always, get the sellers phone number for a future private conversation if needed.
Chris, I didn?t do the job I wanted to in answering your post, but I hope it gives you some food for thought and a feel for what you have to do,

Ed Garcia

Re: Stupid Realtors - Posted by John

Posted by John on March 20, 2006 at 21:54:17:

Most real estate agents just don’t understand creative finance. I have been told I can not sell a property within a year, You can go to jail for subject2, and the best a seller can not do owner financing unless he is a licensed lender. The majority of RE agents know only how to sell to the Owner occupied buyer, with traditional financing. I even had an agent about 4 years ago tell me I had to get a preapproval letter form a lender before she could submit a cash offer.
It took me 3 years to find an agent that is also an investor that understands. I rarely use an agent, my deals mainly come from my marketing efforts and word of mouth.

You could contact the seller directly. The seller would still owe the agent their commission. However, be prepared that the agent will be offended that you bypassed them and do their best to kill any deal you make. This may or may not happen but it is very likely.

Non qualifing assumptions are almost gone however some lenders will allow you to assume a mortgage for a fee and a credit check, especially if it is an above market interest rate.