OfflineHi everyone I'm in a bind and need help. To put a long story short my family is in dire need of money so im going to wholesale. Not try I have to or we are going to lose everything. I have realtors in place. I cant afford to lose any money so what would be the best contingency clauses.
Also is it best to put earnest money in an escrow account to make multiple offers on the Mls. Any help would be appreciated
Thank you
Paul
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Use the inspection contingency. Don't know what state you are in but here we just use a copy of a check to make our offers. You don't need earnest here until the offer is accepted. Then you usually have 48 hours to come up with earnest. If you have a buyer ready to go, get him under contract and use his/her money!
Michael
Knowledge is power, but execution trumps knowledge. Tony Robbins
http://www.mdhomeacquisitions.com Seller site
http://www.mdhomeacquisitionsbargainhouses.com Buyer site
http://www.mdhomeacquisitionshousehunter.com Bird Dog Site
http://www.mdlodeals.com Tenant/Buyer site
Lots written out here on EM so feel free to research. But in general:
- When working with a realtor just submit a copy of the EM check with each offer. If an offer is accepted then make sure the funds are there for the check. The contingencies will be the standard ones in a Realtor's contract: financing, appraisal, clear title.
- Working off the MLS can be tougher. You're working with realtors, higher EM amounts, plus the listing has already been out there for everyone to see already.
- Many people recommend working with motivated For Sale by Owner listings. The EM is much more negotiable (could be $10), and you can add other contingencies like "subject to partner approval". That said, wording like that can make the offer weaker. But if the seller is motivated it shouldn't matter much.
Good luck!
- Tom
If you are working Off Market properties, you can write in a very long inspection period which gives you more time to sell the property or assign the contract. Most home owners don't pay too much attention to it once they are signing a contract. At least this is what I've found. Standard contracts in AZ will usually list 10 days inspection, but I list 15 (business) days, which gives me 3 weeks.
When I make offers on the MLS I usually put down $500 earnest money because it's usually what is expected. When I make offers OFF market, I only put down $100. It can be whatever the homeowner accepts. They are usually more concerned with the price they are getting than the amount of earnest money.
So yes, I agree with Tom.
I write in that my EM is due upon approval of inspection, even with the bank owned properties they have been excepted. Make your inspection period as long as possible. The banks are currently pushing for 5 days.
Oh and do not forget the little box for neighborhood review. I once lost a sale because the buyer found out there was a sex offered in the area.
Good Luck
"Don't tell me I can't, Tell me how I can."
True to all said here, I use $250 for earnest in kansas city & $500 in san diego for MLS props & $1.00 for off market props and will increase if the seller balks-which no one has balked until now.
for MLS if they balk I increase it but keep it to a minimum I don't agree to large deposits, but I may do that if the deal is good enough, I do have a guy who will put up the earnest money for a 30% fee of the emd, which is fine by me as long as I get the deal.
But I am going to start putting in that in my contracts, emd will be payable upon successful completion of inspection. Thanks Donna.
Mbjoseph I will use 15 business days for inspection too, nice.
Tony
Go faster do more! GFDM!
I appreciate everyone's comments. I'm looking at doing Matt Larson's 25:1 system because it seems to leverage other people's time. I'm looking at doing multiple markets in the Wisconsin area at once. I figure if I have 5-10 agents all making 5-10 offers a week. Mathmatically I should get an offer accepted somewhere I'm thinking. Today I'm finishing calling agents. And going to start calling Craigslist ads for buyers who advertise and also start calling the landlords to see if they are interested in buying or maybe selling. Any additional information you guys and gals can give me would be great.
My parents dug themselves a huge mess and I'm determined to get them out. This whole ordeal has caused huge problems between my girlfriend and I. HA. Sorry that's sarcasm. She doesn't think that I can do this and it drives me nuts. I look at this as a huge personal challenge and I'm going to overcome it. Plus I would like to open a no kill animal shelter when I start making bank with the wholesaling and I can't do that with my salary. But first things first right. Like I said before any insight you can give would be a huge help.
Thanks again everyone. I might have to start a blog
Paul