There is No Such Thing as a Handshake Agreement in Real Estate

[Jay Scott]

Just wanted to share a situation in my first deal since coming back into the business after 5 years off. I'll keep it short. Luxury Flip in Miami. Seller is several months behind. Due to the situation, the only thing that will work is a creative finance structure. After I sent an LOI, the seller changes his story, and tried to push me into the deal, and keep telling me that as "men of honor" we don't need to put any of the changes to the deal in writing. He thinks because there is such a big spread, that I will do it. Haha! In every deal, EVERYTHING has to be in writing! And the moment a seller starts waffling, that is a HUGE red flag! I pulled the plug on the deal. Moral of the story? Never "fall in love" with a deal. Everything needs to be done the right way! Sometimes, the best deals are the ones you never do!

[Philip Barr]

It is essential for terms to be in writing when it comes to contracts in general, but especially real estate deals. Whenever there is ambiguity between parties, there is an opportunity for exploitation and dispute. It is always recommended to have an attorney draft contracts for you or at least review them to ensure that your rights are protected and you are being treated fairly.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.