Using an Option Agreement can be another great way to lock up a property with a FSBO. An option is a unilateral agreement between two (or possibly more) parties wherein the OPTIONOR (the owner/seller of the property that is the subject of the option) has agreed to sell the property with a certain price and terms, to the OPTIONEE (the prospective buyer of the property) as some time in the future.
In the typical option agreement, the OPTIONOR (seller) is obligated to sell the property with the agreed price and terms; however, the OPTIONEE (buyer) is not obligated to buy. This is why the option is referred to as a unilateral agreement.
Now, some might say well that is fine and dandy, but how do I protect my option in the mean time. Well you would want to cloud title. Essentially, you would file an Affidavit & Memorandum in the county courthouse on the property referring to the option agreement made between you and the seller. It should note the date that the Option agreement occured and clearly identify the property Optioned. If the seller tries to sell the property out from under you, the title search will come back with your Addidavit and essentially stop the deal from occuring until they discuss it with you and negotiate with you to remove the affidavit or kill the other deal.
You can use these with Contracts for Deed and Purchase Agreements when you question the integrity of the seller.
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If you would like the chance to work with me or one of my fellow real estate investor coaches and our advanced training programs, give us a call anytime to see if Dean's Real Estate Success Academy and our customized curriculum is a fit for you. Call us at 1-877-219-1474 ext. 125
Using an Option Agreement can be another great way to lock up a property with a FSBO. An option is a unilateral agreement between two (or possibly more) parties wherein the OPTIONOR (the owner/seller of the property that is the subject of the option) has agreed to sell the property with a certain price and terms, to the OPTIONEE (the prospective buyer of the property) as some time in the future.
In the typical option agreement, the OPTIONOR (seller) is obligated to sell the property with the agreed price and terms; however, the OPTIONEE (buyer) is not obligated to buy. This is why the option is referred to as a unilateral agreement.
Now, some might say well that is fine and dandy, but how do I protect my option in the mean time. Well you would want to cloud title. Essentially, you would file an Affidavit & Memorandum in the county courthouse on the property referring to the option agreement made between you and the seller. It should note the date that the Option agreement occured and clearly identify the property Optioned. If the seller tries to sell the property out from under you, the title search will come back with your Addidavit and essentially stop the deal from occuring until they discuss it with you and negotiate with you to remove the affidavit or kill the other deal.
You can use these with Contracts for Deed and Purchase Agreements when you question the integrity of the seller.
If you would like the chance to work with me or one of my fellow real estate investor coaches and our advanced training programs, give us a call anytime to see if Dean's Real Estate Success Academy and our customized curriculum is a fit for you. Call us at 1-877-219-1474 ext. 125