After I’ve assigned a contract to another investor, is it my responsibility to inform the seller that someone else is buying the property or would the new buyer be responsible for that?
???Hey, that’s a good question. Being a newbie is a real learning experience and I need all the answers to all the questions.
I would do it just as a courtesy to the seller. It’s a simple letter or phone call - not too much to ask since you made your assignment fee.
You can do one of two things: one, you can mention it to the seller then step out of the way or two, you can stay a part of the transaction to continue the communications between both your investor~buyer and the home seller so, that they both get what they want and you end up getting paid when the deal is completed if you haven’t already been paid. You can also ask your investor~buyer for any suggestions.
You want to treat each transaction/flip/wholesale pretty much the same. First, you have to treat this as a business to which it is. Second, make sure you convey and/or communicate well to the seller and they are fully aware of what is going on. If not, it can blow up your deal. Keep everything on the up & up.
Prior to even entering a deal I let the seller know that if I can’t personally close on the property one of my associates / partners will close on the property.
I always want to make sure all of the gray areas are taken care of before the deal is going through because I dont want something to ruin it in the end.
I have only encountered one or two sellers that said no because of this which was not a big deal because I just moved on.
You have to be able to really explain why you must do this and it will usually put the seller at ease.
Another piece of advice that I can share is that you should always make sure your investor / cash buyer does in fact close on the property. I would not sit back after you complete the assignment contract and just think that your buyer will close. You initiated the deal with the seller and you want to make sure it is complete.
Good Luck With Your Deals!
This is great advice, it only takes you once to get burned by someone claiming to be an investor and not really knowing what he is doing …thenm you’re deal blows up! Talk about everyone getting upset!
May I ask where you are learning to invest? Which education system are you using?
Alex, Thank you for the complements. As you mentioned it only takes getting burned. Well when I first started out that happened to me. The investor never completed the deal and it was just a horrible experience.
What I also do now is I continue to find investors for the property until it finally is completed. I make sure I have at least 1 back up investor in my pocket just in case.
Tony Chicago, Are you asking me what education system I use or is that a general question for everyone?
I have been investing in real estate for many years and I have just learned as I go. The best thing to do is to set yourself up with investors who can mentor you. I didn’t mind doing the grunt work at first.
Since I started investing I have been working on putting together my notes and experiences into a little course that I hope to be finished with shortly.
So you been doing this all by yourself without a network of people or have you had support. I was curious what you were doing.
Tony and everyone,
When I first started I did not have a network. I did it solo and I was stubborn. I kept making mistakes and became really frustrated.
I still am young but I was really young when I first started and I saw that people were not really listening to me because of my age. I started to network with investors out there and soon found out about my local real estate investment association and it just went on from there.
I pretty much did whatever I could for some investors as long as I was learning. I did alot of grunt work and did not really get paid at all. It didn’t bother me though becuase I knew it would pay off.
I soon after that realized that the bigger the network I had the better it would be. More investors, more learning, more knowledge and more profit.
On a side note, the course / ebook I have decided to work on came to me one day because I realized that I have learned so much from my positive and negative experiences. One of my friends at my school asked me how I do what I do and if I would show him how I do it. I didnt see myself as much of a teacher but over time he has become pretty successful.
As a kid and still to this day I always watch those infomercials and always thought that would be awesome to have my own one day. So thats when I put it all together and said what the heck, why not give it a try. Well I rambled enough
Good job. I think people who are new to this need to learn from seasoned investors who actually do deals and not just sell books and tapes. I’ve been fortunate to be in that position and I’m doing deals and learning from the best in the industry.
As seasoned investors, we need to provide this opportunity to others so they don’t waste money chasing plastic magic and work on actual deals.