Dealing with seller's lawyers


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  • Hello –

    Have a what seems thus far like a very good lead from one of my postcards to absentee owners. Owner seems very motivated due to age and seems tired of being a landlord. House is in a great area with great schools, etc, he owns it free and clear, we have some good rapport going on. I told him I will put together a proposal –multiple offers– and get back with him within the next couple of days. He’s happy with that.

    The only thing that concern me a bit is that he mentioned a couple of times that his lawyer had to see whatever I send him. That is fine with me but would like to hear from you guys any advice or things to watch for when dealing with sellers and their lawyers.

    Any feedback is welcome.

    Thanks,
    Rafael

    Rafael

    Don’t let it concern you. Keep your offers simple (not too complicated) and encourage the seller to consult with his/her attorney or CPA about which offer would be the best tax-wise for the seller. Explain that If the seller sells outright, they could have high capital gains taxes plus recapture of depreciation. But if they sell with seller financing, they could take advantage of installment sales benefits. Tell the seller that their attorney may not know anything about the tax consequences of these choices but a CPA would.

    By focusing on the tax benefits of selling with an installment sale, you can usually get the seller to sell with seller financing.

    Of course, your offers should fit your exit strategy. If this is a long term hold, the seller financing will help. But even if you plan to resell to another investor, if you buy with seller financing, you can re-sell with seller financing with a wrap. .

    Good luck,
    jackie

    Let us know how it turns out

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