I would like to close on my first deal. I've located three properties that I know have potential. I went to the addresses to see the properties on my own. After looking around the properties, I've decided this is the time to make an offer on at least one, if not all three. I don't know how to write up an offer. I don't have a P&S Agreement contract form or any of the forms I need to make an offer. One of the listing agents wants a POF (which I don't have) before I can make an offer on one particular property. My goal at this point is to submit offers and get the property(s) under contract. I need help in the worst way. Any suggestions would help.
Are you planning to purchase the property or wholesale it?
You can obtain a standard P&S agreement for your state online. If you're planning on a purchase, you will need a real estate attorney to look after your interests during the transaction. They will help guide you through the process as well.
Regarding a POF, you can easily obtain it through your bank or lender.
If these properties are listed on the MLS you might as well get your own buyers agent to write the offers. The commissions will be the same in either case.
A proof of funds for an all cash offer is a bank statement with the same name as is on the offer, showing enough money to close the deal. If you don't have that, write your offer as financed. Then attach a pre-approval letter from a lender showing you're approved for the loan.
I would like to wholesale this property. My investor friendly broker says this property is ripe for the picking and it won't last long. They want approx. $80K but the property is worth way more. I'm getting this information from my investor friendly broker. the property could sell for $150K easily. It may even sell for more.
@D'Mark Poole is the $150k coming straight from your broker or have you done your own checks on the comps to verify? And is it MLS listed?
I trust my broker and I will have done the comps myself. I get around a little slower with this healing fractured neck of mine using public transportation. For me, this is like being a foot soldier at the point. My boots be to the ground by all means necessary. The property has a MLS number.
Jon, Thanks for your input. You're a great help to the BP community. And that's why I joined BP!
If you have a broker you're working with, have them write the offers.
When determining values, you want to look at ALL possible comps. When agents do a BPO or CMA they will choose a few comps. That's OK under some circumstances, but not for a wholesaler. A potential buyer is going largely disregard whatever information you provide and do their own analysis. So you don't control which comps they use. Same for an appraiser.
$150K properties are NOT listed on the MLS at $80K. A property with an ARV of $150K after some work might be listed at $80K, but if the as-is value is $150K it will disappear immediately if listed for $80K.
Unless you have the ability to secure a purchase contract with an Earnest Money Deposit and POF, then I would play the role of a Bird Dog and pass this on to an experienced wholesaler for a fee of $500 - $1,000. Ask the wholesale to allow you to walk the deal with them so that you can learn the ropes.
God Bless You!
@Michael Evans you're not going to get a bird dog fee for pointing an investor to a property on the MLS.
Honestly, I think wholesaling off the MLS is very hard. Everyone can see those properties. If they're a deal at the listed price, they will move. When a wholesaler passes along a property that I find on the MLS at a lower price, that wholesaler loses all credibility. Now, if you make lots and lots of lowball offers, get one accepted every now and then and pass that on at a good price, you'll get my attention. You're adding value by doing all those offers. If you're just getting something under contract at the listed price and tacking on your fee, you're not really adding any value.
I just worked with a Wholesale company who secured a purchase contract for a $875K property that was listed on the MLS, so it is possible. The main point is if you don't have the experience or the ability to secure the purchase contract, then you can play the role of the Bird Dog.
Bird-doggin is how I started and that's where I feel comfortable right now but I know I eventually have to get in there and get my feet wet. I feel this is one or two that will get away. It's okay, I consider it a learning curve. You guys rock! Thanks for all the input and suggestions.
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