Im looking at distressed properties, and the seller (who is selling options) is asking 5k to have contract written up and to have it binded. IS there anyway i can get around this, or offer somthing else?
You dealing with something similar to what I am dealing with twice already. I am dealing with sellers who $500 instead putting the $1-$10 down to bind the contract. This is getting frustrating. I need answers too.
I've gotten a line on a good # of distressed properties, but most of the GOOD ones want $500-$1000 non-refundable deposit down. They all say the same thing: "If I'm going to not market my property for 30 days, I need some kind of guarantee I'm not wasting my time"
not sure how to reply to these folks. or is the better answer to forget it and move on??
How bad do you want it? If not too bad to put down the larger binder, then offer them $10, or a low amount, and put in the contract that should someone else come along, they must notify you and you have 3 business days, or whatever you can agree on, to tie up the property. All depends on whether you want to take the risk of losing your time or tying up your money. I'm assuming you have a subject to financing clause .
I do want this property VERY badly.. it has the potential to be a nice profit for me. BUT, as I am a brand new REI and I don't have a ton of buyer contacts yet or much $$$ to risk on an investment, I don't think I can agree to $1000 non-refundable on the deal.
I really DO like the idea of putting a small amount ($10) down on the property, but telling the seller that I want to add a clause that says 'if the seller finds someone else to do a deal with WHILE my contract is still valid, the seller must give me 3 business days to finish up the deal or my contract is null and the seller is free to do what they want with the property"
I haven't thought of that before... have you or anyone else done something like this in your contracts before???
let me know... I willl be calling the seller today to suggest an alternative....
thanks... please feel free to e-mail me thru my profile info also.
if he 1/2 way wants to sell the property and he sees you're keen to buy it,maybe include a letter from your bank/lender also showing you've been activley trying to get finance.
I gave one a 30 option to purchase yesterday, which when signed says:
"If for any reason Seller wishes to buy out or cancel this agreement, before Option expiration date, Seller must notify Purchaser in writing and pay Purchaser an "Option Release Fee" of up to $200 to cover expenses paid by the Purchaser. "
Turn it in reverse....I think they see us coming with DUH on our foreheads at times, dont give up, tell him you'll be happy to take your CASH elsewhere to buy another house and leave him your phone number to call if he hasnt SOLD in 48 ****Must Reach Senior Investor status before posting URL's***f course he probably wont have.....
**Make sure you stay home for 48 hrs lol
Yes, I've done deals like this, only as a seller though. It happens fairly often with the new homes I sell. Someone has a house they must sell first, so we put the house under contract, but it remains available for other purchasers to look at with their knowledge of course that someone has a contingency contract on it. Sometimes it actually stimulates someone to put the second contract down and act on it, thinking they might loose the house. Opposite situation from what you want though.
Through my experience owners are more willing to take a small amount of deposit if you sound confident, they almost trust you, and most important stop putting contingencies on contracts that you are putting little to nothing down to lose. Make sure you have the right to assign and put if the owner backs out they have to pay you a fee but you scare the owner with these long contracts with lots of weasle clauses. Weasle clauses kill deals. I hardly ever negotiate my deposit to the owner of the property. We agree on the sales price and I show up with the deposit I want to give and 90 days to do what I got to do. Trust is a big issue. Most owners dont even care if you sell the house and make money, some do now. But they dont like to feel like they are being tricked into something.
You dealing with something similar to what I am dealing with twice already. I am dealing with sellers who $500 instead putting the $1-$10 down to bind the contract. This is getting frustrating. I need answers too.
I know mine is concerned about deals "falling through" i think 500 is steep, nevermind the 5k mine wants.. i just don't know what to tell him
Hey I am in the same situation also...
I've gotten a line on a good # of distressed properties, but most of the GOOD ones want $500-$1000 non-refundable deposit down. They all say the same thing: "If I'm going to not market my property for 30 days, I need some kind of guarantee I'm not wasting my time"
not sure how to reply to these folks. or is the better answer to forget it and move on??
I wouldn't forget it and move on, id try to work out a deal with them. Bring somthing to the table, money talks, we all know that
How bad do you want it? If not too bad to put down the larger binder, then offer them $10, or a low amount, and put in the contract that should someone else come along, they must notify you and you have 3 business days, or whatever you can agree on, to tie up the property. All depends on whether you want to take the risk of losing your time or tying up your money. I'm assuming you have a subject to financing clause .
Terry
I do want this property VERY badly.. it has the potential to be a nice profit for me. BUT, as I am a brand new REI and I don't have a ton of buyer contacts yet or much $$$ to risk on an investment, I don't think I can agree to $1000 non-refundable on the deal.
I really DO like the idea of putting a small amount ($10) down on the property, but telling the seller that I want to add a clause that says 'if the seller finds someone else to do a deal with WHILE my contract is still valid, the seller must give me 3 business days to finish up the deal or my contract is null and the seller is free to do what they want with the property"
I haven't thought of that before... have you or anyone else done something like this in your contracts before???
let me know... I willl be calling the seller today to suggest an alternative....
thanks... please feel free to e-mail me thru my profile info also.
if he 1/2 way wants to sell the property and he sees you're keen to buy it,maybe include a letter from your bank/lender also showing you've been activley trying to get finance.
I gave one a 30 option to purchase yesterday, which when signed says:
"If for any reason Seller wishes to buy out or cancel this agreement, before Option expiration date, Seller must notify Purchaser in writing and pay Purchaser an "Option Release Fee" of up to $200 to cover expenses paid by the Purchaser. "
Turn it in reverse....I think they see us coming with DUH on our foreheads at times, dont give up, tell him you'll be happy to take your CASH elsewhere to buy another house and leave him your phone number to call if he hasnt SOLD in 48 ****Must Reach Senior Investor status before posting URL's***f course he probably wont have.....
**Make sure you stay home for 48 hrs lol
Yes, I've done deals like this, only as a seller though. It happens fairly often with the new homes I sell. Someone has a house they must sell first, so we put the house under contract, but it remains available for other purchasers to look at with their knowledge of course that someone has a contingency contract on it. Sometimes it actually stimulates someone to put the second contract down and act on it, thinking they might loose the house. Opposite situation from what you want though.
I wish you well,
Terry
Through my experience owners are more willing to take a small amount of deposit if you sound confident, they almost trust you, and most important stop putting contingencies on contracts that you are putting little to nothing down to lose. Make sure you have the right to assign and put if the owner backs out they have to pay you a fee but you scare the owner with these long contracts with lots of weasle clauses. Weasle clauses kill deals. I hardly ever negotiate my deposit to the owner of the property. We agree on the sales price and I show up with the deposit I want to give and 90 days to do what I got to do. Trust is a big issue. Most owners dont even care if you sell the house and make money, some do now. But they dont like to feel like they are being tricked into something.
I think i have come to terms with the seller, and we have negotiated. thanks guys!!!
[addsig]