Hello All. I’m dealing with what I initially thought was a motivated, out of town seller, who advertised fsbo. However, now that we have agreed on a price, this seller is insistent on using a RE agent to prepare the agreement; insistent on a certain deposit amount; insistent on using their title co., insistent I travel to the city where the title co. is located to sign the paperwork…
I understand the seller is trying to protect their own interests, but with all of the demands/restrictions, I am no longer interested in the deal. What is the best way to relay this to the seller while maintaining professionalism?
If you are no longer interested in the deal just tell the seller. There is no reason to be unprofessional. Just be clear.
My question is that if this is a potential deal, why the resistance to what the seller is asking? Is it worth throwing away $15,000 because you might have to do a few things you don’t want to do? As long as the numbers work and everything is legal, I would be okay with what the seller needs to make themselves feel comfortable, as long as my a$$ is covered. Ya get me?
I absolutely agree with you. Not having my rear covered is exactly what I am afraid of, I’m guessing the agent will likely be looking out for the seller only. I am still fairly new to the investing arena, and understand I need to always be prepared for worst case scenario… I’m not sure I can say that I am with this deal.
What I initially had in mind is this:
Get the agreement in writing with the seller (without agent involvement), leave deposit with an investor-friendly title co., use the inspection period to get my buyers list into the property, get an assignment fee from my buyer, and be done.
Being that it isn’t going quite the way I have learned, I am feeling uncomfortable with the deal. For example, the seller wants me to give deposit (larger amount than I want to pay) to her directly, rather than title co., she says so she can use it to pay RE agent to prepare paperwork. I don’t understand why I would pay for that, when the seller is the one who wants the agent to begin with. Plus, I was taught to stay in control of the deal, meaning I choose title co. and so on to complete the deal. I don’t want to get myself into something I cannot get out of, and I don’t feel comfortable with the seller controlling everthing.
Well, seller pays the commission so tell him fine as long as he is paying the 6% comission and tell him you will get one to represent you (he will split the commission with his agent). This will net him less money, but it is his doing. As far as the title company goes, I dont see why it matters if it is not a creative deal and title companies may balk at it. My only beef is with the travel thing. They can fax you the paperwork and you sign it.
haven’t done my first deal yet, but a red flag went up when you said the seller wanted you to pay them this large down payment directly.
If you do give that large down payment and proceed, you may (or not) find out more things that make you leery of the deal. If deal goes south, you have to try and get your money back from the seller that just lost out on selling. THat alone would make me say no. People tend to change when they’re not getting their way, or feel they’re getting slighted (by you backing out) He has all the leverage against you with that big chunck of your cash.
Why do they need it to pay the realtor? Realtors are paid with the proceeds from the sale. No sale, no proceeds. Sounds fishy.
Trust your instinct. One or two things that make you uncomfortable could just be your inexperience but you mentioned several things that have you nervous. I think it is best to err on the side of caution. They could just be a nervous seller so you might want to find a way to “counter” their requests such as faxing the docs (as suggested by fadiz)
Whatever you do though, I would insist on paying the deposit to an escrow company (even if it is their company of choice) Oh, and check out that escrow company in the far away land to be sure they are legit.
OK, I am a very suspicious person but I have reason to be. Good luck in whichever way you go with this deal. Merry Christmas!
She wants to use the earnest money to pay an agent? What?
No way!
At this stage, I would not even give the earnest money to the agent because it sounds like they are close. I would give it only to a title company, and only if the contract had plenty of outs for you to get the money back if something does not go according to plan.
Part of negotiating is giving and getting…if you give and let her use an agent and agre to earnest money and all that, then you should be able to pick the title company and make it local.
There are plenty of deals out there. If you don’t like this one, move on to another.
The check for the down payment should go to the escrow account at the Title Company that she is so insistent upon…the Realtor’s fees should come out as a line on the HUD-1 and be paid at closing…fadiz is right - if she is insisting on a Realtor, you should get one too and reduce her profits…