All Forum Posts by: Richard C.

Priced correctly BUT not updated enough = Not priced correctly.

If you're getting no interest at all, you're over-priced.

I wouldn't do A or B.  I'd cut the price.

You buy it from him for $170k, and list it on the MLS for $300k.

If your comps a right (and they are probably not.  Sorry, but it's true.) then you should have no particular problem finding an investor to provide the funds.  Hell, I might do it myself.  

What you don't do is get it under contract, run around trying to sell it, fail to do so, and weasel out of your contract leaving the seller in the lurch.

Send me a PM if you like.

 *sigh*

Please refer to Bill's post above.

 No.  You have a contract with the property manager.  That person acts on your behalf, per the terms of that contract.  They perform certain functions so that you do not have to do them yourself.  But you retain obligations to the tenant, regardless of what the property manager does or does not do.

You are going to be liable for ensuring the tenant gets their security deposit back within the time  period (usually 30 days) required by law in your state.  Get used to that thought, it is very important that you understand and accept it if you want to stay out of legal trouble.

The only exception I could see to the above is if you had a master lease agreement with the PM, where he leased the property from you and then re-leased it to others.  One good way to know if this is true is to think about what happened if there was a vacancy.  If you have a master lease agreement, it would have made no difference, you would have been paid by the PM regardless.

Please consult a local attorney.  

But in the meantime, prepare yourself mentally for the fact that you are almost certainly going to have to write the tenant a check.

Mindy is exactly correct.  You will owe that tenant their deposit back, one way or the other.

As for charging them an additional deposit?  Absolutely not.  Seriously, do not even for one second consider it.

There is one party here who has done everything exactly right.  That is the tenant.  They will be owed their deposit.  This sentence, "It will be a while before that money will be dispersed back to them" alarms me.  

 YOU are responsible for ensuring the tenant gets their deposit back.

If I had to guess, I would say that they were victimized by a wannabe wholesaler in the past, who was not able to actually perform, and they therefore are using the EMD as a test of your ability to actually come up with some money. This is particularly true if there is anything unusual about your financing plan, or the proof of funds/financing you provided.

 Well, as Bill explained above, "partner" has an actual, legal meaning.  So no, it wasn't truthful, and whoever said it was on that podcast was themselves not being truthful.

As far as the "no intent to deceive", I understand what you are thinking, but I think you are fooling yourself a little bit.  You knew you weren't buying the house for a partner.  You were just trying to wholesale it.  If you didn't want to deceive, at least a little bit, then why would you say anything at all to the seller about your intentions?  You could have just presented your offer without saying anything at all.  But in fact, you wanted them to think that you were a buyer.  So you did try to deceive them.

I can understand why you didn't THINK that is what you were trying to do.  That is what Bill meant when he mentioned "cognitive bias" above.  That is basically an instinct toward self-justification.  We all have it, but it is in fact a bias.  It distorts.

You can tell the truth to prospective sellers and still do deals.  In a lot of businesses, reputation is very important, and referrals are the leading source of new business.  You get referrals by being honest with people, and following through on your promises.  And an offer to buy a house is, for sure, a promise.

Maybe they should post in the BP Marketplace for some private lenders.

 I'm not emotional.  I don't know you, or your seller.  I was trying to impress on the lady why the previous responses were not excessive.

Darrell, you seem like you are trying to do the right thing.  You seem a lot more up-front, honestly, than most wannabe wholesalers here.  But you let other people, those other wholesalers and investors, tell you to do something you know is wrong.  You are not an acquisition partner.  You had no intention of ever buying that house.  You want to assign a contract and make a facilitation fee.

Just say so.  It is not necessary to lie to anyone in this or any other business.

 Personally I like the advice to just approach the tenant and see what he says.  If he says, "I know the dog tore up the carpet, use the security deposit to cover it" then great.  If he says, "I know my dog tore the carpet.  But you know, it seemed pretty old already..." I might say in return, "You know, the carpet was older, but I am going to need to pay to have it installed earlier than I would have, so how would you feel about something where I pay for the carpet and you pay for the install?"

But in reality, if I rented a place with 6-year-old carpet, and had a tenant stay 4 years on that same carpet, I would consider myself more than lucky.  I basically played with house money for four years.  I wouldn't charge at all.

PS:  Carpet sucks.