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3/6/2008
The REO I was talking about in my last post (REO #4), is now in a “multiple offer situation”- dreaded words.
Basically, it means every wholesaler and investor, and their Moms and Dads saw the price drop, put an offer in, and now we are being asked for highest and best. I upped my price $500, and am pretty sure I won’t get it. I’m at quite a disadvantage in situations like this when there are other investors bidding against me that can offer higher earnest money deposits, and close in a day or two with their own cash.
Right now, I just can’t compete.
Same situation occurs when a property comes on the market at a no-brainer price- like the 3/2 1200 sf house that popped up on mls 3 days ago for $27,250! Last time I talked to the listing agent, there were 11 offers on the table. I’m curious to see who gets it.
The good thing for me is, there are an ASSLOAD of REOs on the market, with assloads more being added every day, so there’s plenty to go around….
Last Friday, I talked to the lady at the title company that is handling REO #3. She told me everything looked good, and we would be able to close this Friday (tomorrow) . So, I called back Monday just to make sure (I don’t believe anyone anymore when they tell me that everything looks good), and a different lady told me the title work hasn’t even been started yet.
WTF???
She said she would try to expedite things (yeah, right), and I just resigned myself to the fact that it wasn’t going to close until the 18th, which is the last day they have to close. Well, apparently, she wasn’t bullshitting me, because she called earlier this AM and told me everything is ready on their end.
The only thing that is missing is the addendum adding my buyer onto my contract (I’m going to quit claim him off after closing for my fee).
I emailed it to the listing agent a week and a half ago (by the way, I didn’t even ask if I could add my buyer on the contract, I just wrote up an addendum, had it signed by my buyer (and me), and sent it over to the listing agent in an email telling him I wanted my partner on title and to have the bank sign it).
No resistance whatsoever.
Anyway, I emailed it to him a week and a half ago, and he just got it to the bank yesterday. Friggin slowpoke. Anywho, all we need to close is that signed addendum, which means we SHOULD be able to get it done tomorrow. Woohoo!
Let’s see, what else? Oh yeah…..I’m an Aunt!! Auntie Steph. Trevor was born a day early- Monday eve at 5:21 pm. I’m going to head up to St. Louis in the next month to meet him. Can’t wait.
On March 06, 2008 at 10:13am, Tim C said...
Sorry about having to deal with slowpokes, Steph! I hope they get on the ball a lot faster.
I have some quick questions for you. Do you have an earnest money deposit in escrow somewhere that you use for all your offers, or how do you handle earnest money with your dozens of offers?
Also, do you use Steve’s letter of intent, or do you use a standard realtor contract to submit? I am thinking about using the standard realtor contract, making a bunch of copies, and just adding in the date, the address, and my price to each one when I fax it in. What do you think?
And congrats on being an aunt. You can be the “rich aunt” who everyone loves!
On March 06, 2008 at 11:17am, Stephani said...
Hi Tim,
I don’t put an emd up until an offer gets accepted. There are some banks that will ask for a copy of the check with your offer, but not many. Once the offer gets accepted, the bank wants the emd deposited within a certain time frame. The one I’m doing right now, I had to wire the funds to the bank’s title co, which is in Ft. Lauderdale. Mosts banks are so slow, though, that by the time they get all of their paperwork signed, you’ve already had enough time to find a buyer and get a deposit from them, so you don’t have to come to the table w any money upfront. Gotta love the no money down deals…..
I use the FL As-Is contract, which I have in pdf format, so I can just go through and fill in the property address, price, and closing date for each offer. It takes me about 2 minutes to type up an offer. I used the LOI initially, but didn’t have any luck with it. I know that Steve says that’s what he uses, so maybe it varies by locale. The FL As-Is contract is only 4 pages, though, so it’s no big deal. You could try the LOI and see how it works for you, or, do like you said and just make a bunch of copies and fill in the blanks for each one.
Steph
P.S.
I’m totally gonna be the cool, rich Aunt that spoils my nieces (or, neices?) and nephews ROTTEN!
Steph
On September 23, 2009 at 6:45pm, Michael Solis said...
In the case of earnest deposit money when using a Land Trust to flip an REO…
kan i get around having to come up with Earnest Deposit Money by selling the Land Trust or waiting til my buyer closes on the REO with the Land Trust?…the bank would need my deposit,proof of funds letter and my bank statements if they ask correct? or would my buyer provide that if they have assigned their own trustee?…this is fuzzy for me
On September 23, 2009 at 8:35pm, Stephani said...
You will need to have a proof of funds to submit with your offer, and then a deposit once the bank accepts your offer and sends you their addendum. There’s really no getting around that, so I would just plan on having it available if you are offering on REOs.
My first few deals I was able to line up a buyer fast enough to use their deposit to give to the bank. It is tricky to pull off, but I managed to do it somehow..
Steph
On September 23, 2009 at 8:53pm, Michael Solis said...
Just pretend I’m a second grader
…..
ok…i was foolishly thinking i would get around it with the land trust…..total newbie i know….ok so then after this question I am buying your new book…cuz there is so much too know…when buyer closes …i obviously recover my earnest m. deposit by asking for earnest deposit on my wholesale contract…and on top of that my fee…corecto mundo?
Looks like i’m gonna bird dog for now
…. congrat on your book….Flip that reo
mike solis
On September 23, 2009 at 8:58pm, Stephani said...
Yes, you will want to get a non-refundable earnest money deposit from your buyer that is equal to or greater than what you give the bank. That way if they bail and you can’t close, you still come out ahead.
Bird dogging is a great way to start, and also selling deals for other wholesalers.. No risk required…
Thanks for stopping by..
Steph