Happy Saturday Night, kids!
I know most of you are probably still in a turkey induced coma, but I thought I would post another Reader Mail video for you to watch once you awaken…
P.S.
The apostrophe is broken on my blog again, so the title to the post should say “You’ve Got Mail” not “You ve Got Mail.”
Stupid technology.
P.P.S.
If you like my videos and want to subscribe to my YouTube channel- go here. Then click on the yellow “Subscribe” button above the video!
On November 29, 2009 at 6:58am, Elijah Brown said...
I have a question for you. How do you prevent other wholesalers from going straight to your buyer on the next deal? Does that ever happen? Thanks!
On November 29, 2009 at 8:06am, Stephani said...
Hi Elijah,
It can happen, but most of the people I work with don’t operate that way (myself included).
I honestly don’t ever worry about it. If it happens, it happens- there are so many buyers out there it doesn’t really matter…
On November 29, 2009 at 9:44pm, Sage said...
Hi Steph,
First of all love the blog! I’ve read from beginning to end and your perseverance is just awesome. Now onto my question…
What happens when you execute a contract on a REO or distressed property after you get confirmation from a buyer that they will close. Then, on the day of closing, after the A to B transaction takes place, the investor flakes and you’re unable to complete the B to C transaction. Aren’t you taking on the potential liability of being stuck with a property that you can’t unload until days, weeks, or months later?
Thanks for any light you may be able to shed on this Steph and keep on blogging!
Best,
Sage
On November 30, 2009 at 6:18am, Stephani said...
Hi Sage (cool name, btw),
Glad you are enjoying the blog- thanks for stopping by…
To answer your question- if your buyer were to back out of the deal and you had planned on doing a simultaneous closing (using their funds to close both transactions), then you would not be able to close on the deal. Same thing holds true if you were using transactional funding and doing a double close- the lender will not fund the deal if the end buyer isn’t in place, so you would have to back out of the deal and lose your deposit.
The bank can’t force you to close on the property, so the worst that will happen is that you have to back out of the deal (which is still not a good thing), and lose your earnest money deposit. You should also ALWAYS get a non-refundable earnest deposit from your buyer that is equal to or greater than what you gave the bank, so worst case scenario you end up even Steven.
Make sense?
Steph
On November 30, 2009 at 10:03am, Sage said...
Steph,
That seems to make sense. Just a couple follow up questions…
If you line up the funds from the B to C transaction before closing the A to B transaction wouldn’t you be asking for a contract on a property that you didn’t yet own? If that’s the case, how can you get the buyer in the B to C transaction to sign a contract before you actually complete the A to B?
Could you please explain the type of contract and clause(s) that are in the B to C contract to protect yourself in case the end buyer backs out and exactly at what point in the negotiation process it’s signed in relation to the A to B side of the deal.
Thanks again Steph and hope your turkey day ruled!
Best,
Sage
On November 30, 2009 at 12:29pm, Stephani said...
Hi Sage,
You sign the B-C contract any time after you sign the A-B contract with the bank.
I add a clause to my contract with the end buyer that states that the sale is contingent upon me first purchasing the property from the current owner.
Hope that helps,
Steph
On November 30, 2009 at 10:04am, Scott Costello said...
Good tips Steph.
I’ve never heard about an apostrophe missing problem before, very strange
Scott Costello´s last blog ..Probate List is in Hand
On November 30, 2009 at 12:26pm, Stephani said...
I know.
It’s not just the apostrophe, though, no punctuation shows up in the post titles…
On November 30, 2009 at 12:57pm, Scott Costello said...
Your head text is actually an image. So what ever creates that image from the text you type in, is not working correctly.
Scott Costello´s last blog ..Probate List is in Hand
On November 30, 2009 at 1:25pm, Stephani said...
In English, please…
On November 30, 2009 at 2:10pm, Scott Costello said...
haha sorry, I was thinking out loud when I was typing the comment. I tend to think everyone is a geek like me sometimes.
I could take a quick poke around to see if anything is causing the problem. Shoot me an email if you like.
Scott Costello´s last blog ..Probate Monday #6 – What to say when they call?
On November 30, 2009 at 1:21pm, Sage said...
Thanks Steph! That really clears things up for me. You rock!!!
On November 30, 2009 at 1:24pm, Stephani said...
No prob.