No Closing Costs OR Realtor Commissions... HOW???

Question

Hi BP Fam,

When contacting and mailing motivated/distressed sellers, I've read that you can incentivize them by offering "No closing costs" and "No realtor commissions." Sounds great, but how can you buy a house and avoid these costs?

I see that this strategy is being used by @Chris Feltus: https://www.biggerpockets.com/renewsblog/2013/05/10/driving-for-dollars-tracking-owners/

James Wise · Answer

You the buyer are offering to pay those closing costs so the seller does not have to.

Jay Hinrichs · Answer

Ryan Dossey  I have closed a few hundred deals with meridian out your way.. it depends on the escrow officer.. really.

And yes if you want to take the time to go through the little costs those can be negotiated for sure... depends on how much business you bring them..

Ryan Dossey · Answer

A buddy of ours in St Louis owns a title company. Insurance is set. But all of the BS charges like document fees, escrow fees, notary fees, processing, etc. We found that getting in good with these guys all made our closings happen faster as well.

There are title companies who will treat you like an inconvenience. There are also ones who will bend over backwards for you.

Ryan Dossey · Answer

A tip I would give you.... If you're going to offer this. Find a title company and befriend one of the closing agents. You would be surprised just how much money these guys can cut out/save you. (If you're doing volume.)

David Dachtera · Answer

To expand a bit on what the others have said, while you can "absorb" the seller's closing costs, you can also avoid agent/broker commissions by buying from FSBOs and using only attorneys, title agents, and all the needed professionals EXCEPT brokers/agents.

If there's no listing contract and you're not using a buyer's agent in the transaction, you should be good on that score. Brokers/agents are not needed in a transaction, though they serve useful purposes in other situations.

Adrien C. · Answer

you're buying directly from seller so no realtors involved to pay. Buyer pays closing costs.

JD Martin · Answer

Generally it's not that these costs don't exist, it's that there's enough equity to absorb the costs on behalf of the seller.

Jay Hinrichs · Answer

Ryan Dossey  yup our west coast closings could not be more different.  First off the buyer and Seller NEVER are at the same table and they sign one to 5 days before recording and funding.  proceeds are wired 99% of the time no checks. So this alleviates the seller sitting in a closing office waiting on their check  ( which is just so ass backwards to me).

And if your in the industry.. the title marketing rep will hand deliver your commission checks to your broker...AGENTS rarely attend a closing. Lenders NEVER.

I just recorded 4 plats in my market here.. a 27 lot one  a 5 lot one and a 6 lot one and a simple lot split..  My builders rep... ( separate from marketing rep) who handles builder and developers each time came to my Home and I signed the mylars on my Kitchen Island then he hand delivered them to the county for recording.. All this service so that I will bring them my resales on my new construction.. which of course I will do.

that's how it goes here.  out east your lucky if a closing attorney will even talk to you much less any other major services.. its just how its done in different markets.

We also can call customer service on the  phone and get a date down on the phone.. We spend ZERO time looking up properties our selves.. you just call them for an address and within 90 seconds you have a e mail with a TRIO... IE copy of the assessors page. Last recorded deed and tax map... On the phone you can ask them to go into TD's on property any notices of defaults any IRS liens etc etc.. it gives you enough info to go work on the property if you want to.. But its not a full blown title commitment.. And of course they offer this to those in the RE profession... And or bigger investors.. one off home owner will not get the same service or a wanna be getting into the business.. you have to show you can bring them orders.. NOw some folks can talk themselves into it on the front end..but you need to know the lingo.

Jay Hinrichs · Answer

Ryan Dossey  Never heard that one before 45 days.. holy cow.. I would bolt to.

I find in some states the title work is the thing that holds up deals.

If I really wanted something done fast I could order title at 8am and have a full title commitment by 4pm that day and close the next.. our title plants are all digital and each title and escrow company has a plant in the respective counties.. we get GREAT title and escrow service here.. and its UBER competitive.. do you ever have your title rep come over with gifts and take you to lunch.. ????  Our title companies have marketing departmetns and the person in that department that is all they do.. every day they are marketing to agents builders developers ... etc etc.. I found out in your neck of the woods its much different.

I have a great closing Attorney in Jackson MS.. 2 man shop but he can flat get it done as well. But we are moving past 1000 transactions together since 2003... I really don't care what he charges .. he is VERY accurate and I find that to be important.

Jay Hinrichs · Answer

Ryan Dossey  can you expound on this thought... title insurance is a fixed price per thousand unless of course your doing a 50 million dollar deal.

Are you talking about escrow costs.. ?  I find title companies not that negotiable but I have negotiated closing attorneys before for problem on their escrow fee's but the title insurance never wavered

No Closing Costs OR Realtor Commissions... HOW???

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