Those of you who work with Realtors...have you ever tried this...

On our last offer we used a promissary note, but it only gave us until 48 hours after acceptance to come up with the EM. So, yes, they'll take a PN, but in our case we didn't try putting the actual cash out until closing. I'll try that next!

Tracey

I would like to hear what happens when you tell them you don't want to put the actual cash out until closing.

Also I was wondering what happens when you put in your contingencies that they cannot cash the earnest money check until after your inspection time is up? That would give time to hopefully get your end buyers earnest money to cover the check.

Put yourself on the other side. If you are selling your property, and you have marketing costs and holding costs on the property, are you willing to remove it from the market with just a promise to pay, or would you want the buyer to back up his offer with cash? I would want the buyer to perform within the wording of the contract, or loose their earnest money. If the money is not deposited with the closing agent, how would you collect?

I read in a coulpe of books,and also heard it from a speaker no a webinar that you might want put the money in an escrow acount. So lets just say you are making 3-5 offers a at a time just let them know that the money is in escrow. When they call to see if the money is there that will seal it for them.once the offer is accepted and you find your end buyer you get the deposit from them so you do not have to use the money.

Although I haven't done the escrow route yet, I heard from several other investors that if putting in multiple offers, that is the way to go. I personally will be using an escrow company or an attorney to hold the money so you don't have to put $ down on each PO

You must not claim greatness, you must achieve it.

When you look at earnest money in a contract, it is one of the elements that is needed to have a legal binding contract. A promisary note or an IOU is an excellent way to be creative in coming up with earnest money.

Consideration/earnest money:

-This can be any promise, act or transfer of something of value

-Any new advantage to the person accepting the offer or disadvantage of the person making the offer

-Check ( This really is a promise to pay also)

-Cash

-IOU or Promissary note

- A check that can't be deposited until certain conditions in the contract are completed

- A contingent lien on another piece of property (cross-collateralization)

I am glad to see that you all are being creative!

Wow! It's a blessing to hear from other Investor's who have so much knowledge. It's much appreciated!

Thnx

What if you wrote out a check but put the date your inspection period expires on the check itself? Technically they wouldn't be able to cash it until the date on the check right?

Hi everybody. Hope I'm in the right forum. I'm just finishing BARM. I was reading the use of Lease Purchase Options and it said that lots of times, Dean would deal with the seller's agent and explain that they could also act as the buyer's agent to present such an offer. Hoping that this question hasen't been posted a hundred times already, how exactly does the RE agent get paid their commission if you're offering a lease purchase option with no money down? I would appreciate any feedback I could get to clarify this for me.

Thanks in advance everyone.

Paul

Hello all I just wanted to state that when my RE agent and I submit offers, in the additional terms section of the purchase and sale agreement we sate that "earnest money/initial deposit of, for example $1,000, due with in 7 days of acceptance or the contract is null and void.

Then we fax them a copy of a check and the have the time to collect the earnest money from an end buyer.

If that initial deposit is not paid in that specific time frame of say 7 days the contract is null and void.

When jeremy and I placed our last offer, we told the realtor to present the offer and if there was interest, we would submit an em check of only $100.00. We feel with the right exit clauses the em is just a bump in the road and quite frankly a bit of a pain. If we want the house the money will be there. Of course our realtor is an investor also and goes thru the same crap so he leans toward our side a little more. perhaps it is just because we have a good relationship that we are allowed to get away with this......Jan

I'd like to know how this works too, Paul. I'm planning on writing up an offer in the next couple of days. Can we just act as our own buyer's agent too and cut down on the total commission due?

I'd like to know how this works too, Paul. I'm planning on writing up an offer in the next couple of days. Can we just act as our own buyer's agent too and cut down on the total commission due?

I'd like to know how this works too, Paul. I'm planning on writing up an offer in the next couple of days. Can we just act as our own buyer's agent too and cut down on the total commission due?

I have done a few lease options in the Phoenix area. The agents (buyers and sellers) get paid a commission based on the rent for one year, or a preset amount whichever was set up in the listing contract. Then if the renter decided to excercise his/her option to purchase, the agents are paid another commission for the sale. Again, this amount was established in the listing contract. In both cases, the seller was paying the commission for both agents.

Al

I live in Sacramento Ca, and the title company is telling me that I cannot do a simultaneous closing on a deal that I have an option to buy on. They say that I have to come up with the money and purchase the property fist and then turn around and sell it which will make it a double closing. If any one knows af another way to get the house closed without me coming up with the purchase money please let me know.

Hi Roofman,
I have had same road block here in Tacoma, WA. I would love to have advise, PLEASE. Thank you all.

Now keep in mind my only experience so far is by twice reading Deans "Profit from RE Now".

I believe what he recommends is using a RE Attorney instead of a Title Co. and use the And/Or Assign paperwork to take control of the property without actually owning it and then pass it on to the new buyer with your profit included.

Anyone who knows different may correct me here...

Justin
Merced, California

I have many times made multiple offers with one earnest money check being held in escrow. Just like what was mentioned earlier, if anyone calls, they can verify the funds are there. At that point, it's first come first served. When making 30 offers, rarely more than 4 or 5 sellers come back to even negotiate. Once someone accepts an offer and you go to contract, you can halt negotiations on all other projects, and tell them you are no longer interested because you have a different property under contract.

If you happen, however unlikely, to have two or more people accept your offers without further negotiation, one contract will fail to be consummated without the 'binder', or consideration. In that event just continue with the best property at the time.

Obviously, this strategy changes if you are looking to do multiple properties at a time. But that's for another post later.... Happy Hunting!

hello all
we must keep in mind that earnest money is negotible just like the price and terms Its whatever the seller is comfortable with

Hope this is helpful and hopefully I havent repeated some one else

Later Fred E

I am going to say this very carefully. I hope people that want to be a Real Estate Rock Star in their area remember this. A Real Estae Agent 1st of all does not have the code of ethics that a Realtor have. If you are labeled as a cheap investor that does give the buyer a earnest money deposit to cover the seller in case you back out for any reason, good luck on your deal. Keep in mind a deposit could be anything you decide on, even $100 or less. Remember Realtors are a close knit community and if you have a reputation of wasting people time and a joke, good luck with getting your offers even PRESENTED not to mention accepted.

Just the ugly truth. If it was ME and I was going to offer a promissory note that the seller will never see until I decide to actually close the deal, I would offer a significant amount like over 1k to get them interested.

Last thing you want to do to yourself is give yourself a bad name as the cheap no earnest deposit want to be investor in your area.

I wish you all the best.

What paperwork is used in the multiple offers program? It must something simple and can be emailed to FSBO's or MLS listings?

If Assigning...what forms in what order?? Have not done one yet but I'm close!! Are the forms the same in either offer case - MLS and FSBO's??

If making 25 offers a week....use promissary notes for earnest monies? How long a period of time until due?

Thanks!!

found a site using craigslist that will finance your double closings for a small fee it is www.fastinvestormoney.com check them out - hope this helps

Salden,

Thanx for your input. Keep in touch!

John

Hi

Im new to real estate investment and I've just finished Dean's book Profit From Real Estate Right Now! I've found many homes for sale, but most of the sellers are using a real estate agent to sell their home. Is it possible to use Deans IEE system with the Real Estate Agent? How can i go about negotiating the deal without offending the agent or "stepping on anyones toes"?

Thanks

Bruce,

The only thing you can do is make you offer to the agent, who by law must present the offer.

Your best bet is to find a FSBO where you can control the deal and go from there. You can't step on toes if you have nothing to bargain with.

So I have an offer I want to put on a property, but I need to put my earnest money deposit in. I have not done a deal yet so bare with me. This could be my first.

I have a major rehab property for sale, cheap, and a major rehab buyer, good. My buyer likes the numbers but wants the address to the property so he can find out for sure if he will want to buy it. I can't give him the address without locking up the property. Now I am afraid of locking up the property because what happens if the buyer doesn't want it. I have a inspection clause that will give me 10 days to assign it or I am stuck with it. So at least that is there but this is a major rehab that just fell into my lap so I only have one buyer on my list who deals with such big rehab jobs. I want to give the address to the buyer so he can say yes or no, but I don't want him to steal it away from me. Any suggestions so I don't get stuck (I know exit strategy, i.e. inspection clause) and is there a way to get my buyer the information without locking up the property first? Lastly if I back out of the deal before the 10 day inspection period is over do I loose my earnest deposit or do I get to keep it?

Any ideas are enxiously being awated. Thank you for all the posts everyone. I am just freaking out. I am not concerned if the deal actually goes through (that is what I want), but I don't want to make a financially destructive decision. I am moving forward so that is great. I am learning a lot, but I don't, and can't afford to screw up.

Richard
Bothell, WA

Hi Richard
First I will say congratulations for taking that first step and getting out there and finding a deal to work with.
Is this a FSBO? If so I would go back and tell the owner you need more time. 10 days is not enough time to market it and get a closing date. As for earnest money...well I never give earnest money so I don't know about getting it back...but if you just ask chances are good that you will get it back when you present the seller with a new contract with longer than 10 days. Let them know you have a good buyer but it will require more time for inspections and closing. You have to look at your contract and see what it says about getting your earnest money back.
On my contracts I just have 90 days and after that the property will go back to them if I don;t sell it. Good luck!
Sissy

Sissy,

Thank you so much. I am just sitting here looking at every forum I can find. My agent put in the 10 inspection clause for me to back out, but the actual closing will not be until the last day of April due to a renter being in the property. The property is a FSBO, but they are requiring a EMD when I sign the paperwork (I haven't done that yet, scheduled for tomorrow provided the contract is to my approval)
I just don't have the money in my personal bank account to put it up, but the agent said they don't cash the check until after the 10 days for inspection are up. I have 30 days to close, but only 10 days (according to the contract) for inspection clause to in effect. So if I just say "property did not pass my inspection" does that mean I can walk from the deal without penalty? I just can't get stuck with the property. I have been building my buyers list, and will always continue, but as I said this deal just fell on me, it's great, but I only have one buyer that deals with the major rehab so it concerns me. That is why I give myself 10 days and if I didn't assign it by then I need to back out so I don't get stuck with it. This is my plan I just don't know if it a valid plan or if I am setting myself up for a big disaster.

Richard
Bothell, WA