I am extremely mad !!
This week I was working with two different buyers on fours properties.
I have two properties on contract with seller 1 and another two with seller 2
I have been sending the property info, after all my research, out to buyers, posting the ads, and working hard to get these sold
Today, I found out the one buyer contacted the owner directly and made a good deal, lower than contract and is going to buy the two properties.
The other buyer, I just emailed a new lower price that I received from the seller because he wants to sell quick, and the same buyer then within a few hours contacts the owner directly and is getting my contract price. Now he has told the owner he will buy it for that. The owner contacted me and is being very ethical and wants me to handle the showing and sell for 600 fee, but the problem is I had a wholesale fee of 8k on the two property package.
Do you all find this much unethical BS with buyers?
How do I stop this from happening?
Jay just posted about filing a memorandum of contract in another thread. I’d file that ASAP. It clouds title and they’ll have to pay you.
Also use it as motivation. Become motivated to be the biggest wholesaler in your area, and vow to never do a deal with these goons.
I’ve been lucky to not have these issues. When I was new I would’ve been pissed and intimidated, now I’d raise so much hell nobody would ever want to do business with them.
If you still have your signed purchase agreements, immediately record a memorandum of agreement against every property you have a signed contract to buy on. Then you notify the seller that you’ve liened his property.
He will have a fit, and call you all sorts of unfortunate things.
You remind him, that you have a contract to buy, that you are ready, willing, and able to close, and he’s not going to sell that property to his great grandchildren without your cooperation.
Then you can, if you want, call the buyers and explain how they are going to buy from you, or not at all.
Eventually, you’ll get a call to negotiate a release of the lien from the seller, and you can accept whatever you want to accept, in order to walk away from the deal.
Once you agree on an amount, it’s wiser to have an escrow company handle the deal, so that you actually walk away with your money, and the seller walks with a marketable title, that he can sell to your ornery buyers. This could all happen in your current escrow for all practical matters.
Timing is everything in real estate. A seller MUST sell to the first party he agreed to sell to. No if’s, and’s, or butt’s.
Go record the memorandum of agreement. Immediately. Do not wait. This is your insurance policy of getting paid ‘anything’ at all.
I failed to mention that once you’ve recorded the memorandum, be SURE to contact the title/escrow company, to inform them of your newly recorded lien. That will put a stop on everything.
This happened to me a few times, one of the investors was a preacher and the other one was an ex-cop.
It also happened with a few home owners, both old ladies that got better offers after they had signed my purchase contract.
The buyer & I had started escrow on one and the old warhorse seller stated she was not going in to Title to sign.
My buyer wanted to sue, but was worried of getting a reputation for suing old ladies and taking their houses.
I have since added some extra wordage to my purchase contract that sellers acknowledge I have exclusive rights to purchase this property and they agree to not enter into any contract with other buyers till my contract had expired.
I also wrote in that this is a legal and binding agreement and sellers agree to the terms and understand the above context completely.
We soon learn who we can trust. I often wonder if these low life investors considered the opportunities they have since lost out on, especially when I come across insane deals that I def Wudnt send to them.
I sometimes think I shud record my contracts to County records on every deal, it’s only 40 buks for the Notary and 20 buks to record.
I wud have my Title company do the recording, not sure what they wud charge, but going down town, dealing with parking and taking up half my day is not my idea of fun.
I feel your pain, what a crappy thing to do to you. Yea, get mad, take that anger to find better deals and vow to be successful despite or because of these experiences.
It worked for me.
Rando