All Forum Posts by: Charlie MacPherson
Charlie MacPherson has started 194 posts and replied 3331 times.
Post: Buyer wants to change buyer name to an LLC last minute
- China, ME
- Posts 3,432
- Votes 4,032
Quote from @Sam Leon:
(1) the property is a condo, and is being financed, and i just went through their process a few weeks ago, responding to the lender's condo questionairre, provided master insurance information, prepared condo financial statements and estoppel etc...all of those were done as a person. Now, the request to sign an addendum to change buyer name from a person to an LLC.
(2) I will check the LLC to see if the person who is the buyer is tied to the LLC. However that can change at any time right? Even though the contract stated that this is not assignable, bu changing it to an LLC it makes it technically assignable just by transferring control of the LLC from John Doe to Julie Smith right? Or the LLC is a joint investment of John, Julie, Bob and Mike right?
(3) My HOA has approved the sale to the buyer based on the personal name, had to pay an application fee plus do a background check including criminal, credit etc...and the estoppel was issued based on the idea this is a person who is buying. If changing to an LLC I believe I will have to re-process the HOA application as an LLC, and if the LLC is now a different person or control additional people, who knows what would happen. If my HOA needs to re-evaluate, I cannot believe the lender would not require to go back through underwriting?
(4) If the loan was approved based on a person's name, and now with a name change the loan is denied, how does the loan contingency work? Can buyer walk away because the loan gets denied based on a name change?
(5)Yes buyer is asking to sign an addendum for the name change, but it is not as simple as a name change, it will have a ripple effect I think.
(6) I don't think there is an loan approval of the LLC, the loan is approved to the person, IF i signed the name change addendum, then the lender will react to the name change, I am not sure at this point I can ask the lender "hypothetically if buyer name changes from John to an LLC will the loan approval still stand?"
At the risk of repeating myself, this is NOT your problem. He signed a binding contract under his personal name and does not have the right to unilaterally change it.
Changing it increases the risk of the deal falling apart and that is not a risk that you should accept.
I would tell the buyer and/or his agent that you have a contract in place and you expect him to perform to it or risk losing his EMD - which I hope is substantial.
I would simply tell him to complete the sale under the conditions he agreed to and to transfer to his LLC after closing. @Don Konipol has it right. If you (foolishly, in my opinion) agree to this change, you should require a very large, non-refundable deposit.
Post: Buyer wants to change buyer name to an LLC last minute
- China, ME
- Posts 3,432
- Votes 4,032
Unless it's specified in the contract, the buyer doesn't have the right to change it unilaterally.
Tell him that you expect him to perform to the contract as written, and then change the ownership to the LLC after closing.
There's no reason for you to take on new risk of the deal blowing up.
Post: Working equestrian property - residential? Commercial?
- China, ME
- Posts 3,432
- Votes 4,032
As a business broker now (Realtor then), I suspect this could qualify for an SBA or USDA loan. You would have to talk with a lender to find out.
Post: seller requests to stay in the property post closing
- China, ME
- Posts 3,432
- Votes 4,032
We did a significant holdback of funds, but she stayed so far beyond the closing (4 weeks, which was supposed to be no more than 1) that her daily rental rate completely consumed her holdback funds.
My buyer was stuck with a big clean out cost too, as she was a borderline hoarder. I learned at the closing that the buyer had no plans for where she would live next.
It was a disaster as my buyer had given notice at his rental and had to scramble to extend - which his landlord could have refused.
If you do this, be sure to make the holdback at least twice what you think you'll need - and set the daily rental rate high enough that it's going to hurt for the seller to stay.
Post: Highly qualified MD seeking $640,000 in down payment financing for an Assisted Living
- China, ME
- Posts 3,432
- Votes 4,032
I am working with a person who is a medical doctor. She is interested in an 18-bed, $4.2M assisted living facility I have for sale.
We are hoping to get a HUD/FHA 232 loan because it allows a 35 year term for assisted living acquisitions, which of course drives down the debt service.
She has $200,000 liquid, but needs $840,000 (20%) for this loan program.
If you're interested, propose your terms and let's talk!
Post: NEED ADVICE: Want Out of Multifamily Deal
- China, ME
- Posts 3,432
- Votes 4,032
Check the laws in your state. You should also consider mediation. It's a lot cheaper and friendlier.
Post: Buying a duplex
- China, ME
- Posts 3,432
- Votes 4,032
It sounds like you want to go under contract but don't have your loan arranged.
If I'm reading that right, the seller's request is more than reasonable. He wants to be sure that you can actually perform to the contract - and at this point, you cannot as you don't have the funds necessary to close.
That's because you went out of order. First, get your pre-approval - and not a garbage pre-approval from a Rocket Mortgage (or similar), where you fill in the blanks on an application and get an almost automatic pre-approval.
The reason I say those are garbage is that the lender hasn't reviewed any of the supporting docs, like bank statements, pay stubs, etc. Nor have they verified employment or even done a hard pull on your credit.
Once you have a proper pre-approval, then go shopping and put a property under contract.
The seller is smart. They are not going to let you tie their property up for 30 days without knowing that you can actually buy the property.
You have your marching orders. Now go get a proper pre-approval!
Post: Should 6% Still Be Charged to Sellers?
- China, ME
- Posts 3,432
- Votes 4,032
In my RE classes, we were instructed that if we were ever in a situation with other RE agents and a discussion of commissions came up, we were to loudly excuse ourselves from the conversation in order to avoid charges of price fixing.
If you are worth your salt, stick to your commissions. It's hard enough to make a living as an agent without lowballing your own income.
Post: Selling a property to a cash buyer. Things to watch out for?
- China, ME
- Posts 3,432
- Votes 4,032
Two important points:
1. If the wholesaler thinks he can sell it for a significant profit, so can you. List it with a good, full-time agent. You get the full profit (minus the Realtor's commission) and also get professional representation at the same time.
2. $1,000 is peanuts for a deposit. He can most likely default on the contract and lose no more than $1,000. In the meantime, you've lost time on the market while he searches in vain for a sucker to overpay him for it.
If you are neither ignorant of the true market value nor desperate to sell RIGHT NOW, a wholesaler isn't the way to go.
Post: WATERFRONT Granite Quarry - perfect for a small luxury development!
- China, ME
- Posts 3,432
- Votes 4,032
I'm representing a business for sale that includes a granite quarry that is 11 acres +/-. The seller mostly sells granite rubble, but buyers can come with their own cutting gear to take out larger chunks.
The land starts with the hilltop and fantastic views of the river. As the land drops off, there's another flat area when more houses could be built, still with great water views. Finally, the land drops off to direct waterfront where a third level of homes could be built.
The quarry is located in downeast Maine, between Belfast and Bucksport about an hour from Bar Harbor.
The price will be determined by a commercial appraisal, but is estimated at $1.2M.
Disclaimer - There has been no permitting done, so your due diligence is required.
Interested? Contact me through BP!