Deal on the water in NJ!

I'd estimate $14k-$20K correct???

The info I have is $8,914 in 2010.

thats a steal

Yeah! I knew I would get one eventually!

I have some I can send your way at the end of the week

So, I have a few buyers coming on Thursday for a viewing. We're very excited! Hopefully this will be our first complete deal. I am having a little bit of trouble with the realtor though. She is making me nervous. She just called me and told me we are responsible for the escrow money, $1000. She will need a check from us. I tried to explain to her that our buyer will be paying that when he/she accepts the deal and that we can give her a photocopy of a check to satisfy the seller. She started arguing with me about it and said no, she didn't think that's how it works. Ugh! That is how we have done all of our other contracts and this is what the hotline told us to do.

Now I just have to get this realtor to back off before I have a heart attack! LOL

Denise and Allen,

is this your agent or the listing agent that is asking you for escrow deposit?

This sounds like a winner! I'm sure one of your buyers will take it-that's great that you're having more than one buyer viewing it, it will create a bit of 'competition'. If you haven't done so, schedule the appointments so that they all are at the property around the same time..

wishing you success,

Valerie

Thanks Valerie! This is my agent that is asking me for this. I'll have to explain it again to her later when she calls. This is new to her. I had to spend time on the phone with her last night explaining what we do because the listing agent was getting freaked out about why we are having a showing on Thursday. I am just worried about them screwing this up for us.

I have all of our buyers coming at the same time hoping that will create a bidding war. Yeah! One of our partners thinks we can easily get a $50,000 assignment fee. I just don't want to be greedy. I will be happy getting whatever as long as we get our original $15,000.

Here's to hoping we will be submitting our success video to Dean soon!

I just sent you a PM...

Valerie

great job on the pickup! Way to be in it!!

as far as the agent and earnest deposit. she's just doing her job. whether you are the buyer or going to pass off, YOU still have to come with the deposit regardless of the avenue in which it comes. You can front it and tact it to the backend OR what I do is once I have a buyer pick it up, I get earnest from them when we contract. ex: if my earnest is $1k I fund initally and then collect say $2k non-refundable EM from buyer (weeds out other wholesalers exhausting a contract). Separates the players from tire kickers) as on your deal pulling $15k assignment I would then pull a $14k on backend. Net is the same and I'm in $0 out of pocket.

keep us posted.

Be blessed.
Jen

Thanks Jen! I'm sending my husband to the showing with an assignment contract tomorrow. Hopefully we will get it signed and the buyer will put up the escrow right away. We don't have $1,000 to put down unless I borrow from my parents. So, if I had to do it, I could. I would get it back if the deal doesn't go thru, right? Can't afford to be more in the hole. All though I am pretty darn positive this is going to go. Hopefully I won't throw up between now and then. LOL

Hi Guys,

This sounds like a great deal and I may have a buyer for you. Where is this located?

Regards,
Angie

lol! had to giggle. don't worry, I've thrown up before.

getting it back, depends on your contingencies you put in your offer that they accepted.

I always submit with 14 days inspection. I typically know where the property is going before I submit my offer. So once accepted, my buyer can put up the earnest. But in the above scenerio where I put up the earnest when signed and accepted. The clock is ticking. IF I do not have a buyer under contract with non-refundable earnest in 7 days something is off (get the feed back from buyers, what they are seeing?, where would it need to be at for them to pick it up?). You have the option to go back to seller and say you've discovered the repairs are greater than initially thought and agree to still close if they would accept an $xxx price (getting it cheaper) OR simply utilize the contingency and walk. I've only had to back out of one deal. It was a rookie move and I should have done a better job. Live and learn. It's only a failure if you don't get back up OR don't learn from the mistake.
Backing out once your agent will probably overlook, but you DEFINATELY don't want to repeat or make a habit. You'll loose alot of credibility. Unless it is justifyable WITH an actual inspection and major issues.

just my $.2

Allen, suppose your buyer changes their mind at the last minute and holds up the deal for someone else who is willing to bring an actual check and not a copy.

As always I must defend the agent because in fact they are doing their job. What you and most have to understand is accepting a copy of a check is subjective and not standard practice; when they do that its often where there is trust or history.

If you trust your buyer, have them speak with realtor directly to send the check. Under normal circumstances I wouldn't do that but,....

Hope it helps

Ok Everyone! Today is the day! Our showing is this afternoon. I am soooo nervous. We have a showing on Saturday also. So, what if today's buyer wants to make an offer. Do we say thank you and we'll get back to you? I don't want to lose an offer but, the buyers coming on Saturday might beat his offer. Also, our partner wants us to put an ad in the paper today about the house and put $399K in the ad. He thinks we can get more then our 15K assignment fee. Plus, he has buyers that he emailed the offer too. So, if we can get more, of course we will want to do that. So many questions and thoughts running thru my head.

Any tips on how to handle today would be greatly appreciated. Unfortunately the homeowner will probably be there and the realtor. We are a little afraid they will say something they shouldn't.

I can't wait until this first one is done! LOL

I would say set your price and be consistant. If you've already told the buyers your scheduled with one price, honor it. They'll be other to come. If you have not blasted ads/marketing avenues yet. Then by all means set the #'s where you wish. You can always come down, just not go up.
Just a nugget lived and learned. Don't count your chickens before they hatch. (not taking an offer today in hopes of a better to come). If you offer a property to a buyer and he takes a week to look at it, it's his fault if he loses out. Next time, he'll know your pushing hard and know if he wants in, he's got to move.

If there are multiple buyers, the bidding could increase without doing anything. Sometimes keeping the price lower sets the stage for competition and more money in your pocket.

Sandra

Allan and Denise,

if you get an offer today... take it! don't be greedy... you may end up losing the deal altogether, or it being delayed, which means you wouldn't get your money yet to do other deals!

remember that saying... a bird in the hand is worth two in a bush??

Wishing you success,

Valerie

Greed does not allow the proper assessment or management of risk.

Ok, so it went good. My husband said they asked alot of questions that he didn't think to ask. So, it was a big learning experience. But, he did get the impression that if these buyers could steal this from us they would. They wanted to know if the seller would take more off the house because they wanted it cheaper. I don't think they realized we already had this under contract and we were not just birddogs. Are we supposed to tell them what we have it under contract for? I didn't think we should and didn't say it in my original email to them.

He also got that feeling from one of the RE agents that was there. She asked alot of questions about what we do and how we came up with our ARV. She was our agents boss. My husband did not get a good feeling from her. He was also a little upset that they brought packets with them which listed the seller's agent. Do you allow this at your showings? Should we ask them NOT to pass out packets?

Update to our latest deal. We had several buyers look at the property and no one is biting yet. We are getting a little depressed. Nuf said.

"But, he did get the impression that if these buyers could steal this from us they would. They wanted to know if the seller would take more off the house because they wanted it cheaper."

Max allowable offer = ARV x 70% - repairs
315,000 = 650,000 x .70 - 140,000
...you're at about ARV x 75%.

You're right. That is where we are at. One thing I guess I don't understand is if the house goes at $650K and the buyer is all in at around $541K, why is roughly a $100,000 profit not good enough?

Hey guys,

you have to cover the front and back when capturing the spread or net required.

meaning you've captured rehab but no back end. Buyer still has the holding and resale side. (money cost if any, holding (ins,utilities, etc.) agent commission, closing cost, etc.) if you're trying to pull a $50k assignment fee off, then the buyer's lucking to net $20-30k

it's your choice, but a $50k is a large hit for an assignment (aka buyer carrying liability) If you were flipping an apartment complex, you'd be good! LOL

just an input...

I agree with Jen, don't go for the home run, Give a great deal and keep the buyer hungry to work with you on more deals. 20 - 30k would be a nice hit. I would lean towards the 20k and give the buyer a super great deal so they keep coming back to me. I would want to do 10 deals with them instead of one.
When do you have to close by?
JMO.

good luck
Richie

The profit is NOT $100,000.
Sell at $650,000
Commissions 6% = $39,000
Closing costs 3% = $19,500
Holding costs, cost over runs, hidden expenses for 90 day hold 3% = $19,500
Rehab costs $140,000
Purchase price $365,000
Total costs $583,000
Net profit = $67,000 IF and I mean IF it SELLS at $650,000!!!

This does not include your buyers money costs. HM or PM costs? If they are cash buyers than $67,000 is the projected profit. Of course they can negotiate lower commissions, closing costs and have lower holding costs but where is their margin to cover cost over runs? A longer that 90 day hold? Unseen expenses?
You have to look at it from your buyers perspective and give the worst case scenario, not the best case.

What the heck are any agents or sellers doing at your showing when you have the property under contract?? Your contract should state that you can bring contractors, inspectors, investors in to look at the property before closing.

As to why you have had no takers. 1.You paid too much I think 2. What are the average DOM for this area in this price range? If its over 90 days that could be a factor. 3. Your ARV may be off. 4. Your rehab estimate may be off.
Your offer should have been close to 65% of ARV minus repairs = $282,500 offer price.
Assign it for 70% of ARV minus repairs = $315,000 A $32,500 assignment fee!!!

At $315,000 you would have buyers!

You could even offer $300,000 and make your $15,000

You say they would not accept that offer, right? Well, what good does it do to get a property that you can't move anyway. (besides a great learning experience!) Make your offer and follow up and re submit the same offer in 30 days when it gets rejected. Continue doing this until it sells or you get the property. If the seller owes to much to make the deal, MOVE ON QUICKLY!!

Anyway, you guys are doing GREAT!!! You are taking action, this is how you will learn this business in the real world. CONGRATULATIONS!! Don't feel bad if this one falls out, on to the next! I know this is how I learned after getting the basics from Dean and the Academy.

Keep it up, you WILL get one,

Michael Mangham
MD Home Acquisitions LLC

As usual, you are right. We just can't seem to get this offer stuff right. When I use your offer formula, we are not getting anything accepted. I realize our buyers want that low but, I can't get anything for those prices here. We have been putting in offers for over a month now and we're getting no where.

So, today I am depressed about it but tomorrow I will snap out of it and we'll be back at it. Thanks!

Getting a deal that is listed on the MLS is pretty tough these days, unless its and REO and then you will usually have to make multiple offers over several weeks or months. Dealing directly with motivated sellers is the best way I think. It does require a lot of marketing. We have good luck door knocking pre foreclosure properties and probates. NO realtors involved! In any case you must be making many, many offers. Make an offer and on to the next!!

Michael Mangham
MD Home Acquisitions LLC

Well, nothing with our buyers yet. Still waiting to hear from 1 of them next week when their partner comes in from Europe. But, we do have alot of retail buyers calling us about it. They are answering our ad in the paper and on Craigslist. I'm not sure if this deal will be doable with them getting a mortgage.

Hi, Allen & Denise
In my opinion do not wait on buyers. Get them at **** dot com
you can meet new buyers there.
Success and nothing Less!

Wening