Posted by WeRealtyDo! on April 11, 2007 at 20:50:10:
Hello,
Sorry for the misunderstanding. I will try and make everything more understandable next time.
Happy Investing!
WHOLESALE DEALS WITH REALTORS - Posted by Fernando
Posted by Fernando on April 09, 2007 at 16:21:04:
Can you really make a comfortable profit when trying to wholesale a deal when the realtor is selling property for someone or the bank? If so, why do they want an earnest deposit of $250-$500 when I’m only putting the property under contract. Do I really have to give them a deposit?
Re: WHOLESALE DEALS WITH REALTORS - Posted by WeRealtyDo
Posted by WeRealtyDo on April 10, 2007 at 15:13:26:
Hello,
I have read everyone else’s answers, and they all are great.
To answer your question, yes you have to give the agent a deposit. Depending on how you negotiate you may have to give it upfront or tie it into the deal.
The deposit is for legal consideration, and without legal consideration you do not have an enforceable contract.
Happy Investing!
Re: WHOLESALE DEALS WITH REALTORS - Posted by bill
Posted by bill on April 10, 2007 at 06:02:07:
i am a realtor in illinois. we handle alot of foreclosures at our office. most if not all of the banks and repo companies we work for they require atleast 700 usually 1000 earnest money and a prequalify letter from your lender, just to submit your offer. not to mention all our agents have buyers/investors waiting for deals/repos so they get called when one comes up. if it is sitting for a while they probably don’t want it. for wholesaling your probably better off going to the courthouse and getting the onse before they get listed with a realtor.
Re: WHOLESALE DEALS WITH REALTORS - Posted by Sgt.Sausage
Posted by Sgt.Sausage on April 09, 2007 at 18:33:39:
==>why do they want an earnest deposit of $250-$500 when I’m only putting the property under contract
Think about what you’re doing: putting a property “under contract” effectively takes it off the market. The realtor want to ensure you’ve got some skin in the deal and won’t walk from the contract, as well as to compensate the owner for the time the property is off the market … should you renege on your contract.
==>Do I really have to give them a deposit?
Depends on how good of a negotiator you are. Given the above, how would you attempt to talk 'em out of it – or talk 'em down to a drasticly reduced amount.
Untrue - Posted by DaveD (WI)
Posted by DaveD (WI) on April 10, 2007 at 20:08:50:
Untrue. Consideration means a lot more than deposit. Five bucks is consideration enough, in the right sandbox. Like dealing directly with the owner, whom EM may not matter. But not in the realtor arena.
Realtors, reo depts, etc. want to see some evidence the player can perform, and nothing proves that more than a few thousand dollars down. If Fernando wants to buy REOs, he better come up with a few bucks. Like anyone else, I don’t want to put money down either, but not doing so in the REO environment is tantamount to banging your own head into the wall. Ouch.
Re: WHOLESALE DEALS WITH REALTORS - Posted by Natalie-VA
Posted by Natalie-VA on April 10, 2007 at 16:16:07:
This has been discussed here time and time again. Earnest money and consideration are not the same thing. Earnest money is NOT required to have a valid contract.
Most sellers will require earnest money, but it’s not legally required.
–Natalie
Re: WHOLESALE DEALS WITH REALTORS - Posted by Fernando
Posted by Fernando on April 10, 2007 at 07:52:30:
Someone else told me to go to the courthouse also but the forgot to tell me which courthouse and dept. because we have several courthouses all in the area. If you know which dept I need to ask for that would be helpful.
Re: WHOLESALE DEALS WITH REALTORS - Posted by LHT
Posted by LHT on April 10, 2007 at 24:34:55:
Instead of putting endless clauses into the contract - make contract contingent upon feasibility study being approved/waived within 30-45 days.(Your offers are more likely to be accepted this way)
What I do in my contracts is offer them a 2,500 earnest money deposit if/when my feasibility study is waived. That means it is feasible and I have found an investor to assign/flip it to. That investor will give the 2,500 deposit and the feasibility study will be waived and you have blank number of days from that date to complete the deal(whatever you put in your contract).
If no investor is found to flip property to within 30-45 days, property is not feasible and you are not obligated to buy (as long as you or your agent lets them know this in writing before the 30-45 day feasibility study period is over.)
Tell your agent you are looking to put many offers out and you cannot/will not tie up your money by placing an earnest money deposit for each and every property you put an offer on. If agent does not understand, find another agent who will.
Assure your agent that you do have a long list of investors that will pay all cash for your good deal and close quickly.(If you do not have a list of buyers lined up that should be your first step because the seller and agent is trusting your word and tying up the property off of your word solely.)
If your agent is not enthusiastic about working with you and putting out alot of offers, as well as experienced with working with investors, by all means, find one who is.
Best of Luck to you.
Re: WHOLESALE DEALS WITH REALTORS - Posted by WeRealtyDo!
Posted by WeRealtyDo! on April 10, 2007 at 17:09:37:
Hello!
Legal Consideration includes a lot of stuff and earnest money is legal consideration. However parties may enter into a contract without legal consideration but in most cases the contract is not enforceable in a court of law. Business Law.
Happy Investing!
Re: WHOLESALE DEALS WITH REALTORS - Posted by Billy
Posted by Billy on April 10, 2007 at 23:47:12:
You keep trying to give bad info, and I believe that you believe it is accurate, but I suggest you quit it until you really understand the difference between earnest money and consideration, it’s apparent you just haven’t grasped the concept yet.
Take a good contract law course at a law school level, and gain the knowledge you need.
Or maybe just call a professor of contract law at a law school in your area and just ask.
Billy, for this post anyway
Re: WHOLESALE DEALS WITH REALTORS - Posted by WeRealtyDo!
Posted by WeRealtyDo! on April 11, 2007 at 24:01:25:
Hello!
I took business law! I have a BA! Here are the words you guys are mixing up:
Consideration
Legal Consideration
Earnest Money
I did not say “Consideration” and “Earnest” were one in the same. I said “Legal Consideration” includes earnest money, “Legal Consideration” includes a lot of stuff.
By the way I have grasped it! Please don’t start with the childish attacks.
Re: WHOLESALE DEALS WITH REALTORS - Posted by Billy
Posted by Billy on April 11, 2007 at 20:04:48:
It’s not childish to request that you stop misleading so many newbies and unsophisicated investors, that may not take what you have to say with a grain of salt and put them at a disadvantage when dealing with certain other parties.
I’m glad you have a BA, I too have a BA and passed the California Bar but decided not to practice law.
Maybe you do grasp it, but even so you seem unable to convey a clear and concise interpretation of your knowledge of the law in your posts and thus only tend to convey some other meaning.
Billy, for this post anyway.