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How many hours a week do you spend on generating leads, talking to sellers, and deal structuring?
I (we) have been putting in 10-12 hours a day on my off days from my wonderful full time job, I say that very loosely! I have 3 days off 1 week, 4 the other.
1. I put in 15 REO offers a day, 56 cents on the dollar.
2. I put in 15 SS offers a day, 56 cents on the dollar.
3. Wife and I pick 1 subdivision on my days off each day to put post cards on doors, money is tight for direct mail right now. We do this at 6:00 AM, to hot in AZ after 9:00 am, 110+ everyday!We are trying to get a property to fix/flip with our private money we just partnered with. We finally just received a counter on a REO and SS. Took us 40+ offers to get these two counters, will keep you posted.
Wife is going to close a SS with a buyer we found through her last letter campaign she sent out. We are still trying to hustle out here in the desert. Getting out bided on most offers we send in.
Vic & Araceli Huerta
Phoenix, AZ.hey jackie,
when you get a contract with a seller,in the contract you have that you are going to take over the mortgage sub 2 with a contigency that says you won’t close until you find an end buyer. can you just assign the contract to the end buyer and let them close with the original seller? I then collect an assignment fee and go on to the next one. If so, once you sell the contract to the end buyer for the fee, do you have to go to closing and work out the details with the original seller? do you have to have permission from the original seller to do this? I remember jack saying that he would get a house under contract to buy sub 2, then put an add in the paper, $3,000 down take over my payments. He would then sell the contract for 3k and then move on. Is that a good strategy today? thanks for all the helpAlso, what about the due on sale clause if you do assign this contract? Is there anything you need to disclose to buyer and original seller about the due on sale clause if you assign?
Tim
First of all, you don’t need to worry about the due on sale clause. If payments are getting made on time, the last thing banks want is to get another house back.
Yes, you CAN assign the contract – You would need to tell the seller up front that you will find a buyer for the property and be paid a fee by the buyer so there is no cost to you.
An assignment fee is usually paid at closing usually. So, even though you don’t take title, the fee will show up on the HUD-1 ( keep all transactions on top of the table)
The problem with assigning the contract then you being out of the deal is. . . who checks out the credit worthiness of the buyer? The seller won’t know how. What if the buyers stop paying? the sellers will be mad at you for putting a deadbeat in their house and it will take a foreclosure to get them out.
The sellers will feel that it is all YOUR fault.
You need to protect the seller and the buyer.
What if the sellers collect monthly payments but don’t pay the underlying loan? The buyers lose.
I think it is better for you to stay in the middle of the deal and collect payments from the buyer, pay the underlying loan, and deal with any problems that come up. In exchange for all that you could get monthly cash flow AND/or you could get an option for part of the upside IN ADDITION TO THE ASSIGNMENT FEE.
If you just don’t want to do any of that then you really need to get the seller to sign a very STRONG CYA letter that releases you of all responsibility and liability.
There is BIG OPPORTUNITY in putting sellers and buyers together now!
Jackie
you do need to disclose the DOS to both the buyer and the seller — that can be part of your CYA letter ( of course you don’t call it a CYA letter)
i am currently doing this in a different way. I am basically signing a lease with option to buy contract with seller. Then finding someone that is interested in the home. If I show the home and do all the work i keep the down payment for my work and assign my contract, i also have the seller sign the assignment contract bc i make them make the final decision on who moves into their property. I disclose all of this on the assignment that either party understands that i am not liable or responsible for anything. I am having success doing this. Basically all i am doing is marketing for people and getting paid well for it. If I plan on staying in the deal i would want to do it the way you described instead of a lease and option.
very good Vic & Araceli
Sounds like you are working hard.
You should also look for vacant houses listed, not listed, or on fsbo sites and start making seller finance offers. Just get an option until you find a buyer you can sell to with a wrap. I think you’ll find these are a LOT easier to find with less competition. You’ll get money up front ( downpayment), cash flow, and a back end profit later.
Keep up the good work!
Jackie
anyone else?
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