The Science of Flipping - Episode 45 – How to handle a Seller | Real Estate Investing Podcast

Episode Date: September 8, 2014

document.addEventListener("DOMContentLoaded", function () { podlovePlayer("#player-5eb5ab31e3e99", "https://thescienceofflipping.com/wp-json/podlove-web-player/shortcode/post/612", "https://thescienceofflipping.com/wp-json/podlove-web-player/shortcode/config/default/theme/default"); }); <p>[podlovevideo src=”http://thescienceofflipping.com/audio/ttk1.mp4″ type=”video/mp4″ duration=”” title=”Episode 45 – How to handle a Seller | Real Estate Investing Podcast”]<br /> Justin Colby reviews how to handle a seller that doesn’t know or won’t give you their loan, hoa, or tax information. When wholesaling or flipping a house, this information can be crucial. So check out this Think Tank Thursday so Justin can help you with this issue.

hey guys welcome to think tank Thursday I'm Justin Colby the founder of think tank Thursday but also the science of flipping dot-com as well as the science of flipping Academy my intention is always to give you the most up-to-date information in the best real estate investing education as I possibly can so

today's a wonderful Think Tank Thursday. It is the day before 4th of July. So I'm sure most of you guys are already on vacation. You guys have gotten out of the Phoenix heat. It is hot here if you guys have left, but here in Phoenix is about 110 yesterday and I think it's going to be about the same today. So if this is the first time you've seen Think Tank Thursday, make sure you get over to our website, thescienceofflipping.com and register for the free ebook. But more importantly, I do have an upcoming nice little treat for you guys all who are registered and who do follow us that will be coming here in the very near future so make sure you get over there and register because anyone who does register

I'm going to be giving away kind of a tip top secret type thing that I know you don't want to miss so make sure to get over to thescienceofflipping.com and register. Let's get right into what you know the tip I wanted to talk to you guys about, which is we do a lot of deals here at Phoenix Wealth Builders, which is my investing company. One of the things that comes across when we're doing direct mail that a lot of times we see, but then also a lot of my students will see, and that is when you get to the point of figuring out what the seller's bank information is, or their tax information, or their HOA information.

First and foremost, a lot of the sellers don't really know. So when you ask questions like, do you have a loan on the home? Do you own it free and clear? Are you current on your loan? Besides them knowing whether they own it free and clear? Are you current on your loan? Besides them knowing whether they own it free and clear or not, for the most part, they don't know in detail where they stand on their loan. A lot of times, you're just going to get a seller who may not really

know where they are with their HOA, with their loan, with their taxes. Some people do know, right? Here's the tip and trick that I'm going to teach you is some people do know, they just don't want to tell you. Personal information, none of your business, who are you, why are you asking me these questions, you should know that whatever the rebuttal is that they're going to give you right so i've had very irate people uh when i've asked hey you know do you own the home outright do you have a loan on the property are you current are

you current with your taxes are you current with your hoa they get upset right they feel like i'm judging them i'm not really judging them, right? We sit here and we just want to know a little bit more information about the property, but they feel like we're judging them. So what I have done in the situation is that the seller is absolutely unwilling to give me that information. I just simply simply say don't worry about it I'm gonna give you the offer that I've said I'm gonna give but I'm gonna put a small contingency saying that this offer is good on contingent upon on

loan payoff HOA payoff taxes something of that nature so that way if they are underwater if they owe a lot more taxes than I can find out, I know how to handle it. My offer will be no longer good if they're in a position that they're an extreme default with their taxes, they're an extreme default with HOA, they're an extreme default with their mortgage. I know that I'm going to have that small contingency in my paperwork saying, here's my offer contingent upon these because you won't tell me whether they're good or not or where you're at with them. Now, the secret to finding that information, guys, is your title company. Build a great relationship with your title rep.

They will absolutely, and they're supposed to, go and get that information for you so you can get what's called a payoff, right? They're supposed to get all of the mortgage information, the HOA information, and the tax information for you, the buyer, to make sure that they can provide you clear title, that there are no liens on the property, whether it be tax liens, HOA liens, bank liens, right? So they have to get that information anyways. So again, if you're dealing with a seller who feels judged, doesn't want to give it to you, feels like it's too personal of information, go ahead and get that offer in contingent upon these three things and then let your title rep or your escrow officer go

ahead and find those things out for you and I can tell you we're dealing with a home right now where the seller says oh yeah you know I'm probably only three or four payments behind on my mortgage turns out he's almost like a year behind on his mortgage well that changes our offer because the number that we gave him no longer will work. So now we got to go back to him and say, hey, here's how we can structure the offer. Here's how we can get it done so that you can walk away. You don't have to come out of pocket.

You don't have to catch up on your mortgage. We'll take care of it. So it happens to almost all investors. And there's two components that I want to leave you with today on this Think Tank Thursday. One, your escrow officer ultimately will find out all of that information, HOA, tax, and mortgage liens. The other one is if they aren't willing to give it to you, if they get defensive, if they feel like it's private information and you don't uh you don't have um credentials to get it or you they don't feel like they can give it to you because it's private information

don't worry about it submit your offer contingent on these three things that you are up to date on your hoa your taxes and uh your mortgage and then if they are that offer basically is null and void you can restructure offer like we do so we can get a a price that would actually work for so that's what I got for you guys to down think tank Thursday thank you so much for continuing to follow us I'm also on iTunes the science up flipping dot com is also on iTunes get over there but even more importantly, get over the website and just register because I got the free ebook on the 15 most costly mistakes

you can make, but I have a little something special coming out to all those people who register, so make sure to register, and we'll see you again on Think Tank Thursday.