Which Is Better, Assignments Or Fast Closings?
I see lots of discussion here about ‘getting it under contract’ and then assigning the contract. I promise "fast close, cash" in my “I Buy Houses” ads. I"ve bought two so far, but had to use cash & HELOC money, no Sub2s or fancy deals yet. I’d like to be able to string a seller along for 30 or 60 days, and sell/assign contracts to retail buyers (no wholesalers here in the boondocks). Then I don't have to worry about closing them all myself and coming up with cash and marketing.
But how do I explain that I’ll need 30-60 days before I can close to a seller who’s expecting a “fast close?” I worry that if I try to drag it out (especially by offering an ‘option to buy,’ which seems a little noncommittal), I won’t get any contracts at all. How do you pros deal with this? Thank you for any advice.
Welcome to my world, the great wonderful world of RETAILING. I advise all people who start out to retail property. But in order to be able to retail in 30-60 days, you must have a strong QUALIFIED buyer's list.. You basically are still flipping contracts, but you would have the option to purchase.
In order to do a fast closing you will need several people on your team:
1) Someone in financing
2) title company, closing agent or Attorney
Depending on what state
3) Appraiser
4) A GREAT AD!!!!!!!!
These are the basics to retailing
Lori
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Thanks, that's interesting, but I'm still wondering how to get sellers to accept a long month or two close or option as opposed to a quick purchase, which is probably what they would prefer...do I just keep plugging away , throwing mud at the wall until someone actually takes me up on my 30-60 day option, or is there a better way to create this possibility?
That is where the STRONG BUYERS list comes into play.
ex:
1)Tuesday Seller has house, has room , accepts option
2) wednesday go to buyers list, select buyer, show house
3) thursday sign agreement
4) I could have this closed by the following Friday, that's 11 days.
5) could you? not at first, but by 30 days
The key to retailing is a strong buyers list
Lori
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Lori
Where do we get a Strong Buyers list?
Thanks lady
Advertising!!!!!!!!!
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Try networking, RE meetings etc. I know that a couple of Mortgage brokers that invest keep track of people that are marginal and are looking for a home. Frequently they will show the home before it comes under contract.
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Hey,
The answer to your question is: you present the seller with two ( or several) different contracts.
Basically, one says all CASH in 7 days at a price and the other says more CASH but in 30-60 days. You can structure the contract as a option or whatever you want.
I agree with everything Lori has suggested about buyer lists.
I think Bruce has more directly answered the core of the original question.
1. You run ads offering fast closings for cash. Make an offer of a fast close for cash.
2. At the same time make an offer of a slower close for what might be more cash to the seller if they can wait for it.
You stay true to the ad and you also let the buyer choose. It is their decision and if they choose 'slow' then you do not have to string them along. They made the choice.
I would expect a significant discount for cash in 7 days. I would be more willing to pay more to a seller that works with me on the timing (and the terms if also possible).
John
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