Posted by Kevin Doherty on January 22, 1999 at 21:09:58:
I cannot express to you how strongly I agree with SCook! I’ve found that trying to be deceitful in this buisiness will make you some money, but being completley honest will make a hell of a lot of money. Don’t you think your realtor will find out your origional intentions at the closing table? Subsequently, how many properties do you think she will toss your way in the future? Be honest. You’ll have buyers calling back with friends of theirs, and realtors calling that you’ve never met before.The hardest thing in life to get and keep… A great reputation!
I was reading some of the posts below about finding good realtors to work with. One question that comes to mind is that when you are starting RE investing and decide that you are going to start your investing career by flipping deals(cause you don’t have much cash or credit), should you tell a realtor that all the deals that he will find for you are going to be flipped to someone else or should you just tell him that you are looking for fixer upper type deals and will pay all cash for them and not even mention anything about flipping.
Also, if I ended up flipping a deal that was brought to me by a realtor, how does the realtor make anything from it. Is his commission paid by the investor I flip to or do I have to pay his commission?
The preceding might seem like silly questions but I would really appreciate someone answering them.
Thanks
If you are assigning your contract, the present owner pays the commission. If you are actually taking title and reselling, then if you use a realtor in the resale, you would also owe a commission.
As a realtor, I would want to know you are planning on flipping, because I might show you different properties in each situation. But, I am an investor first and realtor second, so I understand what you are trying to do. I unfortunately can’t say that about most of my realtor counterparts.
Re: USING REALTORS ON FLIP DEALS - Posted by SCook85
Posted by SCook85 on January 22, 1999 at 16:37:48:
Relationships!!!
Your realtor can become your friend. Why does everyone take the attitude that the realtor is the enemy and that you have to keep secrets or not tell them what you are doing and so on. My realtor knows everything that I do. We bacame friends and I tell her exactly what I am doing. We had a selling agent call her up one time and say “I know he is trying to flip that property” (as if I were doing something wrong). Her response was “you are absolutely right, he is not trying to hide it, do you have a problem with it?”. He couldn’t say anything. Contract was signed, non-assignability clause was crossed out and their was nothing he could do.
It helps when they know what you are doing. It takes awhile to develop those relationships. My realtor will look at homes for me now and let me know what she thinks they are worth and I make offers without looking at the homes. She calls me whenever something new comes up. I live in a different part of town then she does. She checks out everything in her part of town so I don’t have to. This came as a result of establishing a relationship. I consider her a friend. I’ve bought a number of homes through her.
Find a realtor that you get along with. Let them know your plans. If they are not open to what you want to do they never will be. When you find an open minded person whose personality meshes with yours you can get something good going. Don’t think of them as the enemy, my realtor is an asset to me.
The Realtors commission is paid by the seller, since they are the ones who employed the agent.
So, don’t sweat it. The only time you’ll pay commission is if you hire a “buyers agent” or negotiate for you to pay it as part of the deal.
Hope this helps,
Jim
Re: USING REALTORS ON FLIP DEALS - Posted by Patricia
Posted by Patricia on January 22, 1999 at 10:00:16:
Thanks for the tips Jim but, as far as the first part of the question, should you tell the realtor of your intentions to flip the deals to someone else or should you let him know that you are looking for properties to be rehabbed and will pay all cash for them or just not say anything?