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About Don47

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  1. Please comment on how the option money and rent credits should be applied when working the T/B toward qualifing using FHA financing? It has been my practice to apply the option money toward the down payment (the 3.5% that FHA requires). I usually apply the rent credits toward the purchase price. The property is offered somewhat higher in price than the seller will end up with to cover the rent credit and option money, however. I realize the lender will dictate this, but I need to have guidelines up front when I discuss this subject with the seller and T/B. I want the T/B to understand how the process works so he can keep good records and be better prepared when his credit repair is completed and he applies for his loan. Thanks. Don
  2. Don47

    Getting T/B to call

    Michael thanks for your reply. I have a sign in the front yard with flyers. The rent is $950.00 with a purchase price of 142,500.00. The house is also being advertised for rent by the owner (he is also a investor). Very few calls from his ad as well. His ad is in the local paper. My ad on Craig's List gets a wider exposure, however. My ad says 30% rent credits for the first 12 months and the terms of financing are spelled out as a L/o, noting an option deposit, no specific amount mentioned and credit improvement help assistance, if needed.
  3. I have been somewhat successful in putting under contract a few houses to L/O. I have put them on Craig's List with a link to my website that goes right to the page the home is on. I am getting a lot of views and "click thrus", but no calls! I have several pictures and a video tour. These are nice houses in good neighborhoods. I did comparables to set the asking price and they are priced below what seems to be their current market value. But still no calls. On one particular house, my Craig's List ad shows 327 views and 101 "click thrus". This house is 12 years old top condition. My area covered on Craig's List is somewhat larger (all of NW Georgia) than say a city coverage area, so I know I will be getting many "sight seers", rather than T/B looking to L/O in my particular county. But apart from that, can anyone reading this post give me some help in getting the phone to ring. Thanks
  4. I have a seller who is interested in doing a cooperative L/O. I also have a T/B who needs a large home in the area where this seller lives. I have been working with this T/B for some time. He contacted me to L/P his home as he was buying another, but the deal fell through when the house didn't appraise. He has gone through the prequalifing process for a mortgage and could close sooner rather than later. He likes the L/P concept and wants to do this in stead of closing on a loan immediately. The seller said that he could come by and see the house to determine if it fits his needs. I am ready to set it up, however, I am wondering what role I am playing, since I have no signed agreements as yet. I am not as yet a "Principal" in the transaction, so am I acting in an Agent role until I get an agreement signed with the seller? I an not a Real Estate agent. Thanks for comments.
  5. Don47


    If the deal falls through due to the seller not being motivated enough, does the tenant/buyer get his option deposit back?
  6. Don47


    Please let me know if anyone has experience with the following situation. When you enter into an agreement with a seller using a L/O strategy, it will be necessary to establish his home's value. It is usually not best to go with his numbers unless he has had a recent appraisal. I have not found many sellers who have done this. I was told by my mortgage banker that the seller could hire a realtor to complete a "BPO" appraisal as he called it, that could establish a fairly accurate value of the property. He further mentioned that with so many foreclosures currently that home values have dropped and in some cases significantly. The problem comes up when the tenant/buyer is ready to exercise his option to purchase and the lender orders an appraisal. Once completed, the value could come in well below the sellers expectation. The value may even be below what the sellers owes. It seems that the number of foreclosures have driven down the houses selling on the retail market, especially if their condition is good. What position does this put the tenant/buyer in, since the seller cannot sell because the lender will only lend on the appraised value, which could be much lower than the contract price? Thanks.
  7. Feb 28 I agree with your assessment of the agents thought process. I guess I am speaking from an idealistic view. Dollar signs have a tendency at times to blur a sense of doing what is right. In most cases, agents work hard for their commission and they deserve it, especially in this current market. If a seller contacts me about doing a L/P and his house is lisited, I tell him that I cannot interfere with the listing. I let him know that he could contact his listing agent about doing a L/P, that I would be glad to sit down with them to discuss it. I don't want to cut the agent out of the deal totally. We usually can work something out. Besides, one does not want to creat waves in his market. If his listing has expired, then I will be free to pursue the L/P with the seller.
  8. Michael: I want to take issue with the agent that called you about the homeowner contact you made. I do not believe that agents should have a corner on the market. Agents provide a service for sellers, but so do we. As you said if the seller is happy with the agent's service he will decline our offer to provide our service. But on the other hand, the seller may want to try something else. The question is, "what is best for the seller"? The agent will try to protect their interest, ie. time and money spent on the listing. They should not try to create a monopoly in the market, however, by excluding other options for the sellers to consider. Would a salesman who has secured business from a company tell another salesman from his competition who has called on the same company in an attempt to secure business himself to "Never contact my client again?" I don't think so. People in business realize that there is competition in the market place. It is up to each indivadual to know his market and provide the best posible service, realizing that others are marketing for the same customers. Sellers will certainly benefit from the competition created. From our end, 'may the best service win!' Thanks. Don47
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