I have a few concerns about a deal I am working on with my good bud, Gorgeous Frazier. She seems to be a DG Star in her own right so I thought I would give her a shout out. We are working on a deal that involves the acquistion of 22 properties. We sent informal offers on all 22 to the seller today which he gladly accepted without any counters. Great so far, but the problems is with the contract he uses for his transactions. We don't really have a problem with any part of the contract except the Earnest Money Section. Below is what that part of the contract says:
CLOSING AND PAYMENT INSTRUCTIONS.
Upon execution of the REPC, Buyer shall deposit $1,000 as Earnest Money Payable to Direct Title Insurance Agency to hold this property
for 3 days of the contract signing date. After 3 days from the contact signature date the Earnest Money will no longer be refundable. The
full payment of the remaining purchase price to Direct Title Insurance will be due within 5 days after signing this contract after the 5th
calendar day the property may be resold if Direct title has not receive full funds or arrangements have not been met.
Our thoughts are this: We don't feel that we should have to put up a thousand dollars for all the properties combined let alone each individual one. We are trying to figure out how to get around this and actually, would like to use our contract. Actually, it is the one that DG provides. Seems to work well. It protects us as the buyer whereas the seller's does not.
Can anyone offer any advice or suggestions on this topic?
What we would like to do is attach a promisary note that says the end buyer will provide that money at closing since these contracts will be assigned. I have heard of people locking up properties for $10, in some cases for a dollar as crazy as that sounds.
Also, as the buyers can we put both of our names on the contract or will a seller usually only accept one.
Need to make this deal happen and get this deal done with Gorgeous because she totally rocks.
Any thoughts are highly appreciated.
It's not what we get, but who we become and what we contribute that gives true meaning to our lives.