Help Breaking the News

My question would be, are you OK with it? If you're having problems justifying why you deserve $23,000, then they might too. Try to focus on how you helped the seller, because they wouldn't have agreed to sell if they felt your offer was not helping them in some way, shape, or form. If it were me, I'd try to get my mindset around the fact that I EARNED the $23,000 (which you absolutely did, and you deserve it), and I also helped the seller out of a "situation". If you are mentally rock solid about those things, the seller can't take issue with your profit (I think it's called the "Law of the Jedi" or something... ha!). Congrats on the healthy assignment fee by the way.

I may have missed something, but this is an assignment deal right? Why are you telling the seller youre going to make 23k? This is an "A" to "B" and "B" to "C" transaction right? Are you saying when you find a buyer you go tell the seller how much you will profit? I must have missed something lol I couldnt imangine anyone doing that.

if they had to go the traditional way with an agent, they would probably have to pay half of that, but they could be waiting for months before their property would sell. Investors have buyers ready to move, which means that seller will get their money pretty darn quick!
Don't underestimate the value of your services! Besides, it's not coming out of the seller's pocket; let them know that it's YOUR buyer who's paying you; they are getting the full price of what they want to sell their property for...

I agree with Bennie here. I am confused as to why you are revealing this to the seller. It isn't necessary.

Here are the steps that I use:

1) Tie up contract with seller
2) Find buyer. Assignment contract is made between me and end buyer ONLY. I usually have it notarized. Buyer gives me my assignment fee to step into my position. I give him a copy of my original contract
3) I then take Assignment Contract to Title Co (or whoever handles closing in your state)

You are finished. Clean and easy.

Karen

Are you dong an instant equity exchange?

and not a cash wholesale? if so, then seller will know how much property was sold for, including the wholesale fee... unless, as Karen says, you get paid by buyer separately...

I DO include a clause in my A-B contract saying something about the fact that I am an investor and will be making a profit on this property but I never disclose the amt.

If I am going to be making over $20k profit I usually plan to do a double close, but that is to keep my END BUYER from knowing the amount of profit I will be making off of HIM!

Karen

Thanks for all the response.. lol wow # 1 if it was an assignment... you are right... the seller does not know.... My buyer needed financing.... and to avoid seasoning issues... I can not " double close " the lender would require I have owned the property for a length of time....usually 90 days.
So I draw a contract from the " new buyer " and the seller.... with seller paying me the difference @ closing. Todays went fine.... and I know I deserve it and all the good I did the sellers.... but sometimes when they see such a large profit.... and they are selling to break even..... they want to negoiate price..... I know how to handle all of this.... I was just looking for an efficient little statement to counter any such statement. All is good and this should be a great deal for me. Actually the seller has 2 homes to sell.... I listed the other one on the MLS Flat fee service for $ 590 k and an agent called me today saying he would have multiple offers to submit.... I will make $75k off of that one after I pay the agent his standard 2.5 % ... Almost $ 100,000.00 off of one seller and within a week and half has me all smiles : )

Here are the homes www.HomesSoldCheap.com

DG

Doesn't sound like you need any advice! Doing VERY well with what you are doing already!

Karen

I think I need to get advice from you!!!

Yes it seems to be getting better and better. Keep in mind I do nothing to these homes.... I dont clean, fix, or make any repairs what so ever. I buy ugly and sell ugly.... and either I sell... or the deal dont happen. Its the best way I have found to make $$ and invest nothing but my time and the cost of a few signs... I believe there is always something new to learn though... thats why I still ask.

DG

Hi Raven,

What I learned from Matt and dean is when your making a $5k-$10k profit on a deal you can assign the contract and the buyer and seller would know how much are you making. When your making $10k+ on profit on a deal you should do a double close, that the buyer or seller would not know how much your making on the deal.

P.S. Great job on the deal

i called and found a realestate agent that will work with me,i have her looking propertys that are asis vacant on the market for over 200 hundred days. now im scared to death, she will be emailing theses monday.im afraid to fail this is what keep me going.

Reynold - When you have cash buyers you can do exactly that..... There are no rules. When you have buyer that needs financing neither of those will be an option for you. Im sure Matt and Dean cover that in another chapter some place.

DG

Wokeup - If I can give any advice at all.... it would be make sure you know how to get out of deals if need be. Once you know that.... Fear will be reduced... You just need to get in there...... get your feet wet... and if you have a passion for this you will make it some how... Dont be afraid to ask questions.... None of us have all of the answers.. you just keep plowing on and learning along the way.

Good Luck !

DG