I AM STUCK ON THE EARNEST MONEY!

Have you thought about pre-marketing it to your buyers? If you find somebody who would truly want it, get a deposit from them. Do a double close with a hml or transactional funding co. just make sure your buyer can perform. Check out Youtube videos for Stephanie Davis. She describes how she can do it in detail. Maybe you can do an "opt out" clause with the EM deposit?

I would did that many offers all at the same time. It's like asking yourself how to eat an elephant - 1 bite at a time. If you have the go for 2, do it. If not, go for 1 then once that's done you can go up in numbers. But whatever you do, these homes need to appeal to the buyers or you're gonna be wasting your time if nobody likes the deals or should I say the location or numbers. These are only my suggestions. If I find any more useful advice, I'll post it here. Good luck with this.

Lane When you put your offer in you can say EM when offer is accepted,besides it doesn't processed unless it is accepted.

Or you could get it from your body Matt

Sincerely,

B.W. Slade

I have about $30,000 in earnest money on offers I have made. These copies of checks are meaningless unless the offer is accepted and the contract to purchase is signed. I put out a lot of offers and few are accepted, when they are accepted, then I have to produce actual earnest money.

Who did you say was coaching you?

I am still looking for deals in Denver!

Michael Mangham
MD Home Acquisitions LLC

Other people bring up questions like this. The point still remains though, even if just one offer is accepted, and only that first $500 is used, what happens when another one pops up accepted in the next day or two? I know I'm constatnly keeping an eye on the fine line between paying my bills and going under with an overdraft fee.

I can never get ahold of Matt. He is too busy.

Greg Harmon is coaching me. The leader of my REI group. He is a very good coach, I think I am just stuck on something that I shouldnt be.

Good answer D.C.
This is the sore spot for a lot of people here and overlooked until it is to late. It is that all important buyers list that is so important. A must have, a large numbers of buyers with varying "will buy... qualifications" or a LOC at your bank or pre-arranged Trans funding or exit clauses (which is not good to use) or try for a set-up on the contract where it is held until a specified point/date or all of the fore-mentioned. These are most of the ways they are doing it. Another is have a large number of buyers/cash or hard money buyers and they get a certificate from them to back them up and go to the bank with that ahead of time. Hope you haven't gotten jammed up yet. For the most part the no money down means you will get it back if you do the process and numbers right. THERE IS ALWAYS AN EXCEPTION if you have a very eager motivated seller that gives you a wide open door then you might not have to have EM.

Have you seen the 2010 edge DVDs. Matt talks about what he does for all the offers he sends in.

For me and my wife we have made a copy of one check and sent it in with all the offers. We buy and hold so I have to have some money to cover the EMD. On the ones I do not want after the inspections I will pull out and the check copy will be torn up. We only have to pay the earnest money if we close on a house that will make us more money.

I hope this helps.

Steve

There is more than one way to buy a house. Using an agent on a normal deal you may need an EMD. If you buy a house from the owner you may not have to come up with an EMD. When students talk about buying with no money at all most of the time it is from an owner no agent.

Steve

What you can do is on the back of your write in the endorser Area ( Subject to contract at ABC St. ) Then on your contract in the area " Under Terms" you write Earnest Money check will not be cashed until closing. This will allow you to write more deals.

when the sellers accepts the offer, the EMD becomes part of the down payment. If you are purchasing to resell immediately to your buyers, they will be the ones putting in the EMD, not you. You just need that first deal to begin your portfolio, go with what you know now if you are unsure and leave the rest for later. God Bless.

Sandra

If you can only afford one earnest money check (one deal) at a time and you get a second excepted, simply state you are withdrawing that offer because you have another under contract and do not sign the contract. Problem solved! OR have a buyer lined up that can cover the earnest and do 2 deals!
A side note. Your REO offer in most cases (99%) will not be accepted without earnest money. They don't do earnest at closing when submitting a cash offer on a REO. Now when dealing directly with home owners or other types of RE purchases you can get a contract with as little as $10 earnest or earnest due at closing (sometimes). This is a strategy to use until you can cover earnest. An offer with earnest will be considered BEFORE one with earnest due at closing. This is a fact. So, to establish a real business with consistent acquisitions, submit professional offers!!

Michael Mangham
MD Home Acquisitions LLC

Thank you to everyone who has helped me understand this! I want to get into my first deal this week! I am at work right now until 10:30 p.m. and then I will be heading home to crunch the numbers!

This is pretty easy to overcome. This is what I do:

I take a check, I sign it, I fill in the amount of $1000. I then copy this check, give it to my real estate agent. (I keep and void the real check) He then keeps this copy as the master. Every time I offer on a house he copies the master, then fills in the To field, and the date field. He then faxes/scans it along with my offer.

Works like a charm...

D

First of all...there is no minimum requirement for earnest money...$1 makes it legal. Second of all if you get more than one offer accepted I am sure you will find a way to come up with the earnest money....beg...borrow...steal (well maybe not steal).

For most of our deals, we just put in the contract that earnest money is due within 24 hrs of an accepted offer. Or like others have stated, just use a copy of the check.

What you should do is give them a xerox copy of the 500.00 EM deposit instead of the actual check. You have to have the 500.00 dollars inside a escrow acct. and I think the Real Estate Agent that you are working wit should be able to have access to it incase one of your offers is accepted. If a offer is accepted you replenish the escrow acct. Does my math equal up here. Look more into it. http://www.massactionrealty.com sorry but my computer skills is not that good.

Hello jay sorry to hear that you are having such a hard time with earnst money.
Well this is what I do being in the same situation as you. First of all I don't give earnst money of a $500 dollars. I only make offers with only a $100 dollars and some time i'll go as low as $50 Dollars. And that's only on the contract.
And in my contingenies, I write that if the deals does not go through that all earnest money is returned to the buyer which is you. But alone with my contracts
I send a letter with proof of funds from Dean's program this assures the seller
that you are capable of making the purchase if every thing goes as planned.
And if they request the earnest money while looking at the contract, I fax
them over a copy of the check and only if the offer is approved will I get the info of the title company and wire the funds from my account. But if the deals
does not go through my funds are covered by my contingeny claus to always make sure that I'm not just giving money away.

Thank you everyone for re-assuring me on what to do! I am off to the races now! The first deal is in my sights and I am zeroing in on the heart and going for the kill! I love everyone in the DG family!

When you put your offers in put in the offer that the earnest money will be deposited with title company or attorney 10 days after acceptance of offer.This will give you time to get your buyer lined up and get the EM deposit from them.

whurndon

Bonus: Here is a website you can go to and download a free software to find
Foreclosures from all the Banks.

www.forecloseroftheday.com

Good to see all these options. I know myself I did the copy of one check and like Chris said min of $1 is all you need but on REO's it can be different but have your buyer's lined up first which you do and let them know when you get one under contract.

And if assigning have the end buyer put up the earnest money or use the transactional funding. On my deal I assigned to Matt I did put up $250 EM and paid that out of my pocket but was planning to hold that one as I did have financing but thought assigning sounded fun and wanted to see what would happen.

It's highly unlikely if you're using these techniques and putting in low offers that you will get more than 1 under contract after only first offer.

The thing you look for is a counter offer then you know you might have a deal. It's a game and a fun one if you know the numbers which you do and if you're not sure you have many to consult.

I wish you the very best and I look forward to hearing about your deal very soon!

Blessings,
CAthy

In San Diego, if you don't put 5-10k emd on REO's, you'll get no where.
I know a lot of guys doing 15-30k or even putting the whole purchase price as the EMD. Just have to know your market & what the others are doing.
Also, if the deal makes since, these Investors will jump on the deal. Very Competitive market over here in SoCal.
We just did some research on a property I lost to another CASH buyer & found his offer was 3k lower than mine but they put up 30k EMD & he got the deal. And the crazy part, they don't even go for the higher ARV & do the full rehab. they bought it at 203k, 20k repairs & listed it at 289k.

On an offer on a property from your real estate agent, does anyone put down a $1?

Thanks!

I believe that the $1 works with FSBO; where you fill out the Purchase Agreement, etc.
When you're buying from a listing agent, then you will need to use a proof of funds letter, copy of check, etc.

Wishing you success,

Valerie

Lane this is what you do!! I Make my offers like this. In the addendum, i write deposit given after acceptance of offer,and after my approval of my inspection period. I put a 10 day inspection period. In those 10 days i go find my buyer,and if i get a buyer in 10 days i use his deposit. If not, then thats my escape clause out of the contract. And the $500 deposit, doesnt have to be 500. Now if your making offers on bank owned properties, then theres no way around it. They want 500-1000 dollars. All you need is a blank check to make offers. unless its accepted they won't cash it. Now with sale by owners , or with mls sale by owners, all you need is 1.00 to bind a offer. Brokers will tell you, no , but you tell them to make a offer binding, i can put up 1.00. They will say no, then you tell them, thats just ur standards, but legally in all states a 1.00 is enough to bind any offer. Rem they got to present all offers. Hope this helps Lane..

With a Proof of Funds Letter...

I need that for making an offer to a Real Estate Agent?