Note Investor · Phoenix, AZ · Member since 2009 · 42 posts · 0 votes
I'm finally taking action!!! I will submit my first 3 offers tomorrow on some REO properties. I wanted to know if it is standard to not enter a contingency for due diligency period of 5-14 days. I thought this was fairly normal (but what do I know, right--lol).
My agent is stating the market is so hot it won't get accepted. Please help!!! I am not local to that market (I have run 6 months prior comps within 2mi of property). It seems there is room for my buyer & myself to win, even with rehab but...I would like to travel there & check these out w/home inspector especially since I'm so new.
What do you experienced wholesalers encounter with due diligence contingency?
Wholesaler · Amarillo, TX · Member since 2008 · 1k+ posts · 659 votes
17y
Most REO addendums will have a built in inspection period. Read through and see if yours does. The one I just filled out had a 7 day inspection period for non-contingent cash buyers built in. That's me. :D I didn't ask for one but they built it in to cover their butts.
I wouldn't trust your realtor as far as you can throw him or her. Not to say that your market isn't that "hot", but that just sounds like such realtor fluff to me.
On a side note, 2 miles of the property can bring you some very different comps or rather non-comps. Half a mile to 1 mile is as far as I would go in a town I didn't know, and even with that I would scrutinized them to find the closest ones.
Note Investor · Phoenix, AZ · Member since 2009 · 42 posts · 0 votes
17y
I agree, I've found a new realtor (buyers broker) who has told me just what you did including looking only .5-1 mi for comps. This contract also has built in inspection period of 7 days! Thanks a lot!
Real Estate Investor · Baltimore, MD · Member since 2008 · 619 posts · 75 votes
17y
Our comps are within 300 feet so I think we are good. The price they have at 80 k is completely unrealistic for the amount of work needed, along with location. 40k may seem so much lower, but these are realistic numbers.
We put the offer in today, so we will see.
My only concern is the roof is leaking badly, which is damaging the original hardwoods, which may cost us an extra 700 to buy an relay over the old ones. But I guess thats why u bid low.... to cover extra costs.
Real Estate Investor · Indianapolis, IN · Member since 2009 · 161 posts · 46 votes
17y
Listen to Ryan regarding the comps.
2miles is almost like asking "Will someone please scam me!" Not literally, but I know that if your working in low value neighborhoods I would not cross any major streets, railroads, and stay as close to the subject home as possible...
Quick example. I see some sellers stating that their homes are great deals. And they are looking for people who do not know the area. Here in Indy you can be on one street and its a war zone, make a right turn and blammo $200k homes. That can lead to big trouble if you buy into that without prior knowledge of the neighborhoods.. So bring in that comp, and it should keep you safe...
Contingencies--- I have none. I've done all the homework I need to before I make an offer, and if you know the area, and your exit strategy you should be golden! Good Luck