I am new to the REI Game - just absorbing the concepts right now. I have a question regarding setting up an agreement with the original seller - (Motivated seller) - Once the arrangement is agreed upon with the seller, and if the seller still occupies the residence, if I make a contract with the potential tenant-buyer - naturally the tenant-buyer wants to see the property, etc. - what’s to keep the tenant-buyer from going around me in the process and making his deal directly with the original seller?
This may seem like a real novice question, but I am still trying to understand the whole process.
I do not have any agreements in place - just starting out - trying to understand the process. I understand I could sue but in consideration of trying to acquire the property from a motivated seller, I am just assuming the property owner to most likely be utilizing (or residing) within their home - whether they are in transition (possible relocation out of state, etc.) or due to financial problems are needing to sell their property.
If the house would be vacant and someone wants to sell very badly, this would not be a problem. If, however they are still in the house, is there anyway within the contract I could stipulate that they are bound by the contract until a certain date. Would that prevent someone (original owner) from bypassing my services (as a facilitator of the sale) and going to the tenant-buyer instead?
You can put all the language you like in the contract. And yes it is binding… but if they don’t honor it, your only option is to sue them. You could record a piece of paper at the court house too, but if the title company miss it or not honor it, then you accomplished nothing.
Are you trying to wholesale the deal? who is your buyer to be afraid of such situation?
Has it happened to me? not in that way, but I had sellers back out on binding contracts and in one situation I have paid for my lawyer for the closing docs. It is cost of doing business and I moved on to the next deal.
Why would they go tho the original seller? For all they know YOU are the seller. There is no need to introduce the two. Your seller trusts YOU to make their payments. That’s all they care about. If you skip a payment and try to tell them that it’s your buyers fault because they didn’t pay you, they will not care. They have a contract with you NOT the tber. Hope that helps clear it up a little.