UNITED STATES, Feb 07 — No matter what your real estate business model is, motivated sellers remain the most profitable source of good deals. Successful real estate investing should therefore incorporate finding deals from motivated sellers and successfully closing them.
This article points out important areas you need to focus in your business.
Other business models would follow similar steps; these 3 are just the main ones
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o matter what your real estate business model is, motivated sellers remain the most profitable source of good deals. Successful real estate investing should therefore incorporate finding deals from motivated sellers and successfully closing them.
This article points out important areas you need to focus in your business.
I have pointed great sources of getting motivated sellers in a different article. As soon as you identify a good deal, you must then secure and close the deal.
In my business, all my deals come through my real estate investor website. Approximately half of them are submitted directly by the motivated sellers. The other half are entered by my virtual assistant who calls back motivated sellers who choose to use the phone, and she pre-screens them for me.
I therefore receive all my deals fully pre-screened, and pre-negotiated. I can therefore tell in a few minutes if I have a deal or not.
You must then set up an appointment to see the house as soon as you identify a good deal. The main reason you need to see the house is to estimate repairs. You should be able to come up with a ball-park figure in about 10 minutes or less.
A thorough estimate of the repairs is not necessary. You just need a rough estimate.
Make sure you sign the contract while you are with the buyer.
If you later happen to crunch the numbers and find you cannot make the deal happen, you can always cancel the sale.
If you like the deal, fax the contract to the title company so they can do title work for you. Always make sure you deliver or mail the earnest money to make the contract binding. Earnest money should go to the title company, not the seller.
depending on your exit strategy, the next steps are determined by your business model:
1) Wholesale the deal
If your exit strategy is to wholesale the deal to other real estate investors, this is when you market the deal to them. A good real estate investing website should also help you build a list of potential buyers automatically - then you just email your deal to them.
If you plan do a simultaneous closing, you then sign a contract with you as the seller. Alternatively, you can assign the contract for an assignment fee.
The title company conducts the closing and disburses the money according to the contract.
2) Lease option / Lease to own
If your exit strategy involves taking over existing payments, then your title company should conduct the closing.
This is why it is important that you select a title company that works with real estate investors and understands various real estate investing business models.
3) Straight buy
If you plan to buy fix and sell, or keep as a rental property, then this is a straight traditional transaction that any title company can close.
Other business models would follow similar steps; these 3 are just the main ones.
When all is said and done, your success in real estate investing, largely depends on the efficiency with which you pre-screen your leads, follow up with them to tie up the deal, and efficiently close the deal.
Communicate directly with Simon Macharia, the author of this article. Ask questions, send suggestions, comments, engage in conversation, or perhaps you would like to submit a project.
Click Here to ask a question, send a comment, or proposal.
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