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Hi, it’s Lou Brown with another of my valuable profitable hundred and one ways for real estate investors like you to win close more deals, and accelerate your cash flow. So today’s tip is number 22 when optioning to buy or when buying on an agreement for deed, always have this seller place their deed in escrow. Now one of the things you might have heard about is that you could actually purchase a property by simply getting an option and a lease with the seller. So rather than actually getting the deed on the property, maybe you’re not so sure there’s equity there. Maybe you’d be better off doing a lease with the option to buy. Maybe the seller doesn’t want to give you their deed. Maybe they want to stop you from getting their deed. Maybe they’re concerned that you don’t won’t make the payments. Maybe they’re concerned they would have to foreclose to get their property back.
Today’s tip is number 21 have the seller refinance their home, get the cash that they need, and sell it to you subject to the existing loan. Now, how does that work? Well, let’s say that you go to the house, and in one of my other tips, I said that we go through a presentation with our sellers. When we’re going through the presentation, we do something called the cost to sell worksheet. We get down to a final number that shows the seller their equity. Now let’s say that our seller was insisting really did need cash. Okay, how can we get them their cash and how can we stay out of the bank and not qualify for a loan? I love that part.
Today’s tip is number 20 control the closing. You choose the attorney or title company and include that in the contract. Now, one of the things I’ve found is whenever I let the seller control where the closing is going to be, or if I let a real estate agent control where the closing is going to be, I’ve found that I have to go through some pain and suffering and in getting in a relationship with this new closing agent or attorney. So I’ve found that my life is a lot better if I have my own team and in my contracts, I tell the seller where the closing is going to be. Or I’ll tell the real estate agent where the closing is going to be.
Today’s tip is number 19, build an extension into your contract. Now build an extension into your contract. What does that mean? So I’ve been talking in this series a bit about a thing called a standard real estate purchase and sale agreement. And uh, I’ve seen what sellers do and I’ve seen when they don’t do what they’re supposed to do and I’ve seen that they can pull back on you and cause you a lot of expense and a lot of loss of money because you could have gotten a title search, you could have spent money getting a survey. Maybe you had the home inspected, it’s a lot slot. You could have invested by the time you get to the closing.
Today’s tip is number 18 and it is offered to buy the property subject to the existing financing. Oh my goodness changed my life first property I ever bought when I was 18 years old. I was able to do that by taking over the payments, taking over the existing financing on the property, how powerful that was back in the day they had a thing called n e n Q loans, non escalating non qualifying loans. But Congress in its infinite bought wisdom. Of course the the banks, we all know they influence the politicians by a thing called contributions to their campaigns. Right. And so one of the things they created in 1982 was a law called the garn Saint Germain federal depository institutions act allowed the banks to put a clause in their mortgages called the due upon sale clause.
Today’s tip is number 17 I’m going through some of the contract closes in our amazing standard rent, a standard purchase and sale agreement on the buying side. Now I’ve got one for buying and I’ve got one for selling. So I’m focusing on the buying side here in this tip when getting owner financing asked for substitution of collateral. Now that’s a powerful one. So I’m going to teach you how to master the process of getting sellers to carry back financing. I love the idea of the seller being the bank.
Now when they carry back that loan, there’s a mortgage and in that mortgage you have some stipulations in there, some clauses, and one of the clauses I recommend that you have in there, and it’s included in my purchase and sale agreement, is that the seller agrees to something called substitution of collateral.
Today’s tip is number 16 now these are all buying tips that I’ve been given through this series and this one is when getting owner financing asked for first writer refusal if the mortgage is sold. So one of my favorite ways to buy property is to have the seller be the bank. Write that down. The seller is the bank. Now when the seller is the bank, it’s a really cool thing because of course you had didn’t have to go to the bank, you didn’t have to qualify for a loan, you saved all the points, you saved the closing costs, you save all of the pain and suffering of qualifying for that loan in the first place. Very, very powerful thing to master.
Today’s tip is number 15 when there is equity, always ask for owner financing. Now of course this is when you’re buying a property, go through your, what we call cost to sell worksheet. I’ll be explaining this in another video and what we do is actually sit down with a seller. We make a presentation to them and we end it with something called the costs to sell worksheet.
Today’s tip is number 14 to assure your contract is binding. Always give consideration. Now let me explain what that means. Contracts in order to be valid must have certain things in there and of course you’ve got to have the parties in there. You’ve got to have the subject matter and you’ve got to have some kind of consideration between the two parties that binds the contract. So here’s what I recommend and it’s something that I’ve been teaching my clients to do for many, many years. And simply it’s when your PR, your seller goes ahead and signs the purchase and sale agreement. Then you go ahead and bind that by bringing a check with you. You make the check payable to the seller, whomever’s signing that contract or sellers, if there’s two of them or more, make the check payable to all of them, have them sign it on the back.
All right, so today’s tip is number 13 have a contract that states disputes should be settled with mediation, then binding arbitration, all. So over the years I’ve developed an amazing agreement and it’s what we call our standard purchase and sale agreement. Now this standard purchase and sale agreement is amazing because it takes care of profits. So it’s got profit centers in there. It negotiates a lot of your transaction for you without each point having to be negotiated by you. And it’s also got a lot of protection in there too. So the purchase and sale agreement, it’s three pages long and it actually goes through, one of the things it does is collect up all the money together on one page so you don’t have to hunt through the document to actually find out what the money looks like.
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