I came across a cash buyer whom I’ve never done business before. They were interested in the property I had, but before depositing any earnest money, they wanted to see the resale contract that I made with the seller. They told me that they’d like to see that there was an actual contract. Sticking to my guts, I declined, offering to show them the open title commitment proving that I in fact have an ongoing contract to the subject property. They still insisted I show them the actual contract. I was transparent on how much I’d be making on the deal, but I still declined showing them the actual resale contract. Why would cash buyers want to see the actual contract when the open title commitment is readily available? Thanks for all the responses.
Most likely to ensure that you actually are able to sell the property. I certainly would have asked to see the same before putting down a deposit. You can just redatact the Seller contact info.
If you start out being transparent, then be totally transparent, it's a good reputation to have.
Well, if you’re assigning the contract then Of Course they need to see the contract you are selling them, as that is what they will be obligated to.....it could be QCD, not call for clear title, lease back to seller, etc.
(1) To start, I provide them with ALL of the information they NEED to determine if it is a good deal for them. This includes a complete package with the details of the property, financial estimates (ARV, repairs, etc.), comps, etc. This does not include my assignment fee. If they're not interested at this point, it should be because the property/numbers don't work for them, and then there's no need to move forward.
(2) If they agree that this is a deal that works for them, and that they are willing to continue moving forward, I ask to see proof of funds. This should be cash, a Line of Credit, or private/hard money lenders in their pocket with their own proof of funds.
-- If we've made it this far, I feel like they've been sufficiently vetted and that I can trust them.
(3) Now we can move on to the property, where we can visit/inspect the property to verify what was in the package. They have the opportunity to vet everything they need.
(4) Finally, if it still works for them, then I move on to the contract. I have an assignment contract that lays out everything between me and the buyer, and the original contract with the seller is an exhibit to that contract.
Yes, they need to see your contract, but not until they are vetted and ready to move forward.