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Updated over 10 years ago on . Most recent reply

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Kirk R.
  • Peoria, IL
383
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967
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What to do after Calls from a Yellow letter?

Kirk R.
  • Peoria, IL
Posted

I am getting ready to send out 100 yellow letters.
Once I send out 100 yellow letters - fingers crossed I get some phone calls.

My rough plan is to set up an appointment. Pull some comps beforehand.  Meet the seller at their property - Build some rapport & figure out if/why they are motivated to sell.  Then what?  

Without having available financing - what do I do next? 

If I try to wholesale the deal - what is my next step?
Could I rent to own/CFD/Lease option/take over payments- and then rent the house out?

fire aim ready ready aim fire i dunno.  Nervous to get responses then negotiate with seller and really have no idea how to execute.

Any input appreciated. 








Most Popular Reply

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Jim Viens
  • Rental Property Investor
  • Kansas City, KS
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604
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Jim Viens
  • Rental Property Investor
  • Kansas City, KS
Replied

@Kirk R. The contract you have them sign is a Purchase and Sale Agreement. It's a standard real estate contract stating if they sell their home it HAS to be to you. There are good solid sample contracts to use here on the BP FilePlace page (link is under the Resources tab at the top of the web page). You may want to run the contract by an attorney in your area to make sure the language is legal in IL before you use it, though. Once it's signed you'll want to take it to a title company and open escrow on the transaction. They'll hold the signed contract until closing.

Folks go both ways on the buyer thing. Some swear by having a solid buyers list before you find properties. Get to know them and what kinds of properties they're looking for and in what areas. That way your property search is more like a shopping list. Others say go find properties and if you have a solid enough deal buyers will not be hard to find. I see pros and cons to both sides. Once you have a buyer lined up for the property you execute an Assignment of Contract wherein you assign your interest in the Purchase and Sale Agreement to the new buyer for a specified assignment fee. From there you take the Assignment to the title company to put with the P&S Agreement. Let them know the new buyer will be contacting them with the closing date. From there you can either go to the closing with all parties and collect your check or wait for it to be mailed to you by the title company (PAYDAY!)

This scenario applies primarily to a straight, traditional "cash" purchase. In your OP you mentioned rent-to-own, contract for deed, etc. These strategies all involve their own unique twists. If you're just starting out I, personally, would advise you to get a few transactions under your belt before branching out into "creative" financing unless you have a mentor familiar with those techniques to show you the intricacies. But that's just me.

Good luck!

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