Hi,
When I have a signed contract with the homeowner(seller) & I have a 5 day right to cancel, when should I show house to potential investors(buyers)? How do I protect my contract, as a newbie I haven’t any “history” with anyone. Is there anything I can record to put a cloud on the title?
Thanks for all your help!
Suzanne Barber
Howdy Suzanne:
Why do you want to cloud the title? 5 days is a fast free look period. You should have asked for more time. Hard to find a buyer in 5 days unless it is a no brainer deal. How much earnest money do you have at risk? If you have more than a few hundred you had best back out of the deal unless it is really sweet and you can close it yourself.
The few wholesalers I know only use about $100 and do not care as much about the free look. They put ads in the paper and get many potential ads to get investors climbing all over the property. It helps to buy a vacant property otherwise showing to many potential buyers would be crazy. Most just have a combo lockbox and do not even meet the buyers until they call the second time showing more interest.
I hope I helped a bit. Plesae ask more questions or get a mentor or something to help make it easier and more fun. You sound a bit stressed. It has to be fun other wise you will not love it.
Hi Ted,
Thanks for the reply, the 5 day right to cancel is for the homeowner. I ask for a 30 day close in the contract. My concern is having a buyer/investor who may try to steal the deal from me. In talking to other newbies, it’s happened to them when they give the address out for investors to drive by. The investor talked to the homeowner and bought the house.
I just wanted to know how to protect my contract while working with new investor/buyers.
I’m not really stressed, I’m having a great time, I’ve been in corporate sales for 20+ years, I just like to have all the information to keep moving forward in my new endeavor. The best way to learn are from the experts like yourself who have"been there, done that". Thanks for your help!
Suzanne
Hwdy Suzanne:
I am no expert by far. I have done a few deals and too have lost out on some. One friend of mine had a 30 unit deal under contract and hired an attorney to help. My friends side of the story was that the attorney ended up with the deal and my friend got a big goose egg. I do not know the actual truth but performnce is the name of the game. If you can not perform the sharks will eat you.
If you know for sure something like this has happened you can file a letter at the courthouse stating the facts of the case and for all buyer to be aware of your pending litigation. You must send notice to the parties that your have done this or are going to do it. It starts getting all legal and costing some bucks. Just having the sales contract at the title company does not protect you because there are other title companies that will not be aware of your contract.
Another way to help is to get each prospective buyer to sign a nondisclosure letter of some sort stating that they will tell no other of the deal and will not buy they property themselves except thru you. This does not stop unethical buyers but could help some perhaps.
If it was an easy business everybody would be doing it and a lot more are entering daily. Just this web site has grown by leaps and bounds in a few short years.
Hi Girl;
In any business you will find (SHARKS)! Try and get with a Mentor so they can teach you the roaps! Split a few deals with your mentor and reap the rewards your mentor will bestow upon you! Their is no contract that cannot be broken! On any contract, use the term (WITH PARTNERS APPROVAL). You will allways have an out. joehagan222
Personally, I would not give a seller 5 days to think about it in the contract. When I am ready to sign an agreement, the seller is committing to selling…he won’t get any time once he signs. If he wants time, he can have all the time he wants, but nothing will be signed by me until he is ready to sell. You won’t have that problem if you deal with motivated sellers.