What's the trick/scam here?

Question

My house is on the market at 1.2M. 30 days and no bites, so I'm thinking of dropping the price. Now, if I go down to 1.1M, and you factor in full asking - 6% closing fee, I walk away w/ 1.034M. So I get an offer from a guy who calls out of the blue. This happens from time to time- investors looking to buy my house. So the offer is 1M and they pay the buyer & closing costs, no agent. Interesting. But the close date is 2 months from now. My gut tells me they pull out at the last minute and then maybe drop the price another 50K or more now that they've eaten 2 golden months during the summer to sell. Why not a 15 day close if it's a cash offer?

James Hamling · Answer

Yeah @Scott R., as @Jay Hinrichs mentioned this is a super easy one.

Buyer put in a very novice written and-or-assigns clause so there clearly looking to wholesale it. And given how it's all presented I give about 1% chance it completes, because there super-green.

I'd reply back that your willing to sell them a Non-exclusive purchase option, good for the 60 days, for say $5k. Flip the script, let's see how dumb they are, entice them right back. And if they bite, ok, get a R.E. Attorney to help you draft it where you get the $5k and they can try shop it but you can keep actively marketing and first one to sell is honored.

Other then that it's pointless to engage with.

Jay Hinrichs · Answer

that clause is out of the wholesaler 101 playbook.. go for 50k non refundable and watch them walk.

Chris Seveney · Answer

had someone I know have someone do this in TX, the end buyer never closed. if it were me, I would collect a $25k non refundable deposit to lock up a home for this long.

John Clark · Answer

I think your analysis is correct. Also, do the offer explicitly state that he is paying your agent's commission? Do your numbers come after you've paid your seller's commission? You signed a contract.

If he's a cash buyer he should be able to close a few days after receiving a fresh survey and title commitment. How quickly can you deliver a survey and title?

Drago Stanimirovic · Answer

Scott,

You're right to be cautious. A legit cash buyer should close in 15–21 days. The 60-day close is likely a tactic to tie up your property, then renegotiate once you've lost valuable market time. Classic investor play.

Scott R. · Answer

lol damn that's clever. Okay that's what I'll do

Andrew Syrios · Answer

Wait, are they paying the agent? With the vast majority of agency agreements, you would have to be the agent regardless of where the buyer comes from. Or do you just mean you would only have to pay 3% to your agent and not 6% total?

Regardless, at the very least I think it would be worth a counter.

Scott R. · Answer

Based on the 3rd paragraph of the docusign (I added it above), it sounds like what they really do is take 2 months to find ANOTHER BUYER to then sell at a higher price. If they find one, they give me our agreed upon amount. If they don't, per the 2nd paragraph, they find any excuse to opt out.

Jules Aton · Answer

Any inspection clauses or other outs? How much are they putting down? Did you get proof of funds?

What's the trick/scam here?

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