Soon to be RE Agent w. a Question & Scenerio
Wholesaler · Orlando, FL · Member since 2010 · 8 posts · 0 votes
Hello everyone. My name is Ashley, I'm about to start my pre-licensure class to become an agent. I know I'm going to have some questions along the way and I'm hoping I can get a few answered here.
My 1st big question is this:
I know its possible to work exclusively with investors; but is this scenerio possible?
A couple comes to me wanting to sell their house fast. I agree to put it on the MLS after marketing it to my buyers list of inverstors first.
^ could I do that?
They say you can do anything if a contrast is written properly... but I'm wondering if that would be a realistic scenerio.
Any advice, tips, or insight you can offer would be gladly appreciated.
Yes you can as long as they agree with you. The point is you're supposed to look out for your client's best interest, and you should present them with all options (MLS is one them, of course). Our state's listing agreement has a specific clause that says we'll list the property with X number of hours, and as long as the client agrees with you on what X is, you're fine. You just need to inform them of all the practices that you plan to engage in in regard to their property. You're supposed to present all offers to your client (through MLS or not). You can advise them but leave the ultimate decision for them to make.
They will grill these concepts into your brain when you take the licensing courses :-).
Having fun sitting through those exciting (not) hours :-).
Hello Ashley, and welcome to the boards!
I'm not an expert in this field (in fact, I'm a complete newbie), but I have heard of this scenario known as "pocket deals". However, in my mind it questions the moral, ethical, and legal aspects surrounding this scenario. If perhaps, the sellers know the situation prior to acting upon it, I don't see much of an issue. However, as an agent, you are trying to get them the highest and best price, so selling it on the MLS and open market would be in their best interest, not selling it to investors who want to get the most for their money.
This of course is my 2 cents. Best of luck on getting your license, and I hope the more seasoned RE investors/agents can reply with their thoughts.
I'm an agent and I try to work only with investors, however I find it hard to turn down others. Anyway, if your plan is to list the property, and as part of your marketing, let your investors know it is for sale, I see nothing wrong. It's no different than canvassing the neighborhood after you list the property. In my opinion, you're not doing the very best you can for your sellers if you don't let every person know that it is for sale.
Just my .02. I am new to wholesaling (started earlier this year-3 deals completed) and just got licensed a few months ago (having my 1st closing by the end of Dec.). I see no conflict of interest. If you have a property under contract and are not listing the property, you do not have to get them the most you can for the property. Their is no agency relationship (although you always have to disclose you are an agent). If you can not sell the property as a wholesaler and then want to list the property, thats when you have to get them the highest possible price. As long as you disclose what you are doing, no problems should arise. Just a newbies .02.
Yes you can as long as they agree with you. The point is you're supposed to look out for your client's best interest, and you should present them with all options (MLS is one them, of course). Our state's listing agreement has a specific clause that says we'll list the property with X number of hours, and as long as the client agrees with you on what X is, you're fine. You just need to inform them of all the practices that you plan to engage in in regard to their property. You're supposed to present all offers to your client (through MLS or not). You can advise them but leave the ultimate decision for them to make.
They will grill these concepts into your brain when you take the licensing courses :-).
Having fun sitting through those exciting (not) hours :-).
While I agree that you're probably ok as long as you disclose and your sellers are ok with it, you are DEFINITELY an agent of these people and thus are legally (and morally) obligated to act in their best interest.
If they are motivated enough to need to sell ASAP they likely will not care that you have a buyers list lined up for them.
do a good title search,check for liens, and open construction permits
Thank you for the welcome Chris!
I appreciate what you said about how a deal like that might make you question someone's moral code, because I hadn't thought about how it might come off to someone else. My intention is definitely not to deceive, so when I meet with a seller I will ask them how they'd like to market their house (signs, MLS, investors) and present it as an option and not something that HAS to be done.
I don't want to stress the sellers because in this economy, I see more and more 'For Sale' signs; some of them for families that have raised their children in those homes, but can no longer afford it. So I definitely don't ever wanted them to feel cheated, or like they got the short end of the stick.
However if they are very motivated and need to sell, as Steve said, I don't think they'd mind. The best interest of the seller will always be my priority. I will always get their input on how they'd like things done, and if using another method, I'll tell them and get it in writing so there are NO confusions!
I appreciate everyone that has responded so far, and I look forward to reading more from you!
That is how I approach it ashley. When someone calls from a bandit sign or postcard I get the details of the property, what is owed in mortgage/liens, why they want to sell and how quickly they need to sell. If they want/need more than what make sense for me as an investor, I advise them I cant pay their asking price as an investor but could list the property as an agent. If someone is looking to get retail value, I always tell them its best to list with an agent. I would say this even before I was an agent
This is going to be a question for your Broker who will be responsible for your business dealings. Angie hit the nail on the head. You can call who ever you like on the way back to the office to enter your MLS data. There is nothing wrong with giving certain buyers a "headsup".
Again, ask your Broker, but unless you are in a Realtor, you can list without putting anything on the MLS. When you get to your class you'll find out that not all brokers/agents are Realtors, while they are usually in commercial lines, you can choose to list and sell yourself....but that might tough to do.
More than likely, your new Broker will be a memeber of the MLS and a Realtor. They will require that your listings be listed and usually with a time requirement, like withing 48 hours of the signed listing.
In reality, your MLS asking price will probably be more than what an investor will want to pay. Your seller may not appreciate real quick low ball offers right off the bat, before the property is really advertised, they could think you're trying to pull something if you don't fully explain what you're doing.
If you're listing a property held by an investor and they need to dump it quick, your idea might be welcomed. Good luck, Bill
Bingo, Frank is right, that is how we are closing 3-4 transactions a month as a realtor.
Right now, most calls off my bandit signs are not good investor deals, no spread or equity, not enough motivation. These sellers just want to move, don't have much(if any equity) and need someone to help them out of a situation. That's where you come in as an agent. List it as a retail sale, or work with them on a short sale, put 8-12 of those in your inventory and you will have consistent closings after your first six months.
I now never have to refer thin opportunities to other agents, I just list them myself, pick up a few 2-4k checks a month, rinse and repeat.
Then you can cherry pick your wholesales and flips.
Best of luck to you, get out there and just have fun, help as many people as you can, be honest, and deals will find themselves to you.
-Mat