OfflineSince my last post people have been asking me how I put in an offer on my Short Sales and Reo properties and get my escrow covered by my buyer.
First let me say that I have successfully built my buyers list to approximately 500 buyers in my area. Granted out of that list maybe 50 are serious buyers and the others are simply "tire kickers" but I keep them in the loop because they are more than likely wholesalers who know buyers. So if I send them a property they will most likely present the property to their buyer with the hope of getting a referral fee. So you want to keep the tire kickers around!
I put in at least 200 offers a month on Short Sale properties. I put my offers in at 30% below the asking price which sometimes ends up being 50%-60% below ARV. I put a deposit amount of $1,000 on all of my offers to purchase and once my offer is accepted I have 14 days to get the $1,000 escrow to the bank.
As soon as I get my offer accepted on a property I immediately begin calling my 50 serious buyers letting them know about the property. I have my agent take my partners through the property before I sign the contracts with the bank. (this is why it is a good idea to have an agent on your team).
If one of my buyers is interested I get them to sign a purchase agreement and give me an escrow deposit of $2,500. That gives me $1,000 for the escrow I agreed to with the bank and $1,500 towards my other expenses to get the property to closing.
I then do a double close on the property with transactional funding.
The key to this process is your buyers list. I am a firm believer in calling my buyers as opposed to just sending an email or posting in classifieds. Calling your buyers builds your relationship with them.
Hope this helps everyone understand this better.
Tips on building your buyers list
http://buildbuyerslist.blogspot.com/
http://realwholesalingrentalmarket.blogspot.com/
NO GUTS... NO GLORY!
Do not fear, for I am with you; do not be dismayed, for I am your God.I will strengthen you and help you; I will uphold you with my righteous right hand. Isaiah 41:10
http://www.realwholesaling.blogspot.com
Carol Stinson
...'double close on the property with transactional funding?' I've been told that you can't ASSIGN Short Sales or REO's with a bank, they just won't do it. So how do YOU do it Carol? Thanks!
Making it happen!
Sincerely, Sheri
Sunrise Solutions, LLC
Thank you for sharing the insight and the information on putting in offers on Short Sales and Reo properties and getting your escrow covered by your buyer. The more we learn each day, the more options we will have with real estate investing. Good luck on all your fuutre deals. Believe and Achieve!
- Joe
Actually you can Assign by using a double close. Basically, the way to do it is by using a double closing and not using the "and /or assigns" on the contract which is what you are referring to, when they imply that they don't do it. I know this because I myself have done double closings for all my all REO's. Basically, no ones that you are doing double closing. The realtor does not know. Only you and your title company know.
"If you cannot do great things, do small things in a great way.”
Napoleon Hill quote
Your not assigning the property. You are actually purchasing the property with private funding (AKA transactional funding) and then re-selling the property to a buyer on the same day. This is known as a Double closing.
NO GUTS... NO GLORY!
Do not fear, for I am with you; do not be dismayed, for I am your God.I will strengthen you and help you; I will uphold you with my righteous right hand. Isaiah 41:10
http://www.realwholesaling.blogspot.com
Carol Stinson
With the transactional funding, what kind of percentage do require back?
Success and Nothing Less!
Carol
Thank you for the informative post and keeping it simple! So clearly you ensure you have enough profit in the deal to pay your real estate agent fee and transactional funding fee right?
Fish