Looking to start investing in Real Estate? Read this guide that is full of information to help the beginning novice learn how to begin mastering the real estate market. From renting, to selling, to buying my goal is to help educate as much as possible.
We have now covered various ways of getting the money to start investing, as well as explained in depth what needs to be included at a minimum in the lease purchase option contract. We are now going to move along to the making an offer for the piece of property of your choosing.
Making an offer means that if the seller accepts your offer, you will be purchasing the property for the amount you offer to the seller. This amount can be well below the asking price; however, the seller is not required to accept your offer. It is always a good idea to have worked on building a rapport with a seller before making an offer. This way you can better tailor the offer around the needs of the seller and your needs. This will help you achieve a much higher rate of seller acceptances.
It is important to make offers in a professional, diplomatic, and mature manner. Calling someone to say “Yo I wanna buy yo house fo $80,000” is a completely unacceptable way of making an offer. You should close your internet browser window and walk away now if you do not see a problem with that type of offer to purchase a piece of property. If however you are aware that the offer was inappropriate, then you can proceed to learn how to make an acceptable offer.
Before you can make an offer, you need to realize that if the seller does not accept your offer that does not mean it is over, they may make a counteroffer. You need to know your financial limitations so that you know when you need to walk away from the property and move on. You need to know your financial limits before making an offer to save everyone time and effort as the negotiations go back and forth for a while.
While making a verbal offer is acceptable to an individual seller, it is best to do things in writing for a more professional image, as well as the ability to keep detailed records of which properties you made offers on in case you want to review the previous offers you have made at a later point in time. Your written offer should be given to the Real Estate Agent or Broker if one is working on the property or directly to the owner if they are selling the property themselves.
Your offer should include the price you are willing to pay for the property, as well as any financing information or the request for any seller assisted financing. This way everything is in writing and clearly able to be reviewed later. It is acceptable to make several offers to a seller in one multiple offer, for example if you have a means of obtaining the funds for a cash offer then you could consider doing the following. Make a 3 offer all in 1, with offer 1 for example being a cash offer of $80,000 for the property, and offer 2 being $10,000 down with the seller holding a 2nd mortgage and total price of $82,000, with offer 3 being a lease purchase option with the purchase price being $90,000 and an initial payment to the sellers of $2,000 with a monthly rent of $800. As you can see the terms in each offer are radically different, however they give the sellers many options and more of a chance at them accepting one. You want to make sure it is clear that each offer stands alone; they cannot take the price from offer 3 and combine that with the down payment offered in offer 2, and so on.
Some sellers may be tempted by an offer, however still be unable to accept the exact terms that you have offered. At this point, they can make a counteroffer. A counteroffer is the exact reason why you need to know financially what you can afford financially so that you do not have to sit on an offer too long and allow it to expire before making a decision. However, especially if you are wanting the property for investment then the price is more important than if you are choosing to live in the property.
Make sure if a seller declines your offer that you remain professional, after all you never know when you will try to purchase property from either them, or someone they know in the future. You never want to leave a situation with a bad or vulgar manner. That can leave a bad impression that will cause you problems in the future. This is never advisable.
The next installment will cover the contract that you will need to have prepared if the seller has accepted your offer or you have accepted the counteroffer that the seller has presented to you. Remember keep calling sellers, keep viewing property, and keep taking notes of the properties you call about and go view.
We have now covered various ways of getting the money to start investing, as well as explained in depth what needs to be included at a minimum in the lease purchase option contract. We are now going to move along to the making an offer for the piece of property of your choosing.
Making an offer means that if the seller accepts your offer, you will be purchasing the property for the amount you offer to the seller. This amount can be well below the asking price; however, the seller is not required to accept your offer. It is always a good idea to have worked on building a rapport with a seller before making an offer. This way you can better tailor the offer around the needs of the seller and your needs. This will help you achieve a much higher rate of seller acceptances.
It is important to make offers in a professional, diplomatic, and mature manner. Calling someone to say “Yo I wanna buy yo house fo $80,000” is a completely unacceptable way of making an offer. You should close your internet browser window and walk away now if you do not see a problem with that type of offer to purchase a piece of property. If however you are aware that the offer was inappropriate, then you can proceed to learn how to make an acceptable offer.
Before you can make an offer, you need to realize that if the seller does not accept your offer that does not mean it is over, they may make a counteroffer. You need to know your financial limitations so that you know when you need to walk away from the property and move on. You need to know your financial limits before making an offer to save everyone time and effort as the negotiations go back and forth for a while.
While making a verbal offer is acceptable to an individual seller, it is best to do things in writing for a more professional image, as well as the ability to keep detailed records of which properties you made offers on in case you want to review the previous offers you have made at a later point in time. Your written offer should be given to the Real Estate Agent or Broker if one is working on the property or directly to the owner if they are selling the property themselves.
Your offer should include the price you are willing to pay for the property, as well as any financing information or the request for any seller assisted financing. This way everything is in writing and clearly able to be reviewed later. It is acceptable to make several offers to a seller in one multiple offer, for example if you have a means of obtaining the funds for a cash offer then you could consider doing the following. Make a 3 offer all in 1, with offer 1 for example being a cash offer of $80,000 for the property, and offer 2 being $10,000 down with the seller holding a 2nd mortgage and total price of $82,000, with offer 3 being a lease purchase option with the purchase price being $90,000 and an initial payment to the sellers of $2,000 with a monthly rent of $800. As you can see the terms in each offer are radically different, however they give the sellers many options and more of a chance at them accepting one. You want to make sure it is clear that each offer stands alone; they cannot take the price from offer 3 and combine that with the down payment offered in offer 2, and so on.
Some sellers may be tempted by an offer, however still be unable to accept the exact terms that you have offered. At this point, they can make a counteroffer. A counteroffer is the exact reason why you need to know financially what you can afford financially so that you do not have to sit on an offer too long and allow it to expire before making a decision. However, especially if you are wanting the property for investment then the price is more important than if you are choosing to live in the property.
Make sure if a seller declines your offer that you remain professional, after all you never know when you will try to purchase property from either them, or someone they know in the future. You never want to leave a situation with a bad or vulgar manner. That can leave a bad impression that will cause you problems in the future. This is never advisable.
The next installment will cover the contract that you will need to have prepared if the seller has accepted your offer or you have accepted the counteroffer that the seller has presented to you. Remember keep calling sellers, keep viewing property, and keep taking notes of the properties you call about and go view.
No comments:
Post a Comment