When looking for a Real Estate Agent, do I have to put down $500 or more to make an offer?

I'v heard of using a promissory note as the earnest money. I'm not sure of the details, but basically you put up the promissory note (dated for the expiration of your purchase contract)as the earnest money. When you assign the contract, you make sure to get the money to cover the note plus your profit. Of course, if you totally drop the ball and let the contract expire, you will be on the hook for that money (and the contract!), so don't do that.

FYI: I'm new at this, so any corrections on what I just wrote by somebody who DOES know the details would be greatly appreciated (especially by me!). That being said, please don't go out and do this without figuring out those details first! And thanks for bringing up an important topic.

feasible that I can use my own Purchase Agreement?
Thanks for the input Brett.

Everyone Does it Different. The Way I do It Is
I Dont use any Money When I have A Contract Accepted I Have 7 Days To Find A Buyer When I Find A Buyer I get $2000 Deposit From Them and I Use That Money For Earnest Money and I have Extra For Me..You Have to Make Sure You Have Your Contract Right..
I Try Not to go any higher than $1000 So I put a Extra $1000 in my pocket on top of my Fee, but every deal is different

Louis thanks for filling out your profile. I admire the fact that you have shared your experience. Just reading it inspires me to share more as when I read it I reflected back to my own experiences and circumstances. Also, you have the courage to refuse to stop swinging.

EMD is negotiable. Recently I won a bid to purchase a property that required a mandatory $5,000 EMD. However, that wasn’t happening. After going back and forth several times I got the EMD down to $1,000.

Just keep in mind it’s all negotiable. I have used a promissory note in the past but to no avail. As far as using your own P/A it all depends on who is the seller. Some of these GOV agencies require it be on a certain form. However with private owners I use my own P/A and often time put very little EMD if any in escrow.

Also, if you would like to share and exchange ideas I’d love to network with you. Send me a pm.

Hi Louis dont forget FSBOs and Estate sales to get you going we will have to get together on this.Dont leave your self open if the note has to be paid and you have no buyer.Some of these government agences require the 500 for under 50k and over 50k 1000 deposit, Jim

I'm still going after my first deal, but I've been taking action for almost a year now. I've had two agents here in CA. The first agent got tired of putting in low offers so I just went out and found another. But here's what I've done with both, I wrote a check for $1,000. I just took a picture and emailed it over to them. I don't have anything in the bank account so I just hope it doesn't get deposited. But from what I understand is 99% of the time the earnest money never gets cashed until closing. They just want a check on the offer paperwork, But if I do get a deal under contract I will just try to find a cash buyer FAST within 24 hours and my earnest money will not even matter. So this is what I've done, not having money hasn't stopped me from putting in offers. If anyone has any feedback with my method please go ahead and comment. It may not be the best method, but its working for me right now.

When working with your realtor, you can tell him/her to pull "Standard Sales" for you also, instead of REOs, Fannies, Freddies or FHA. Standard Sales are the ones that are privately owned and you can often get by with a smaller EMD.

I still think that Driving For Dollars is the #1 BEST way! Pick out your target zone (if you need help on this let me know), get a map of the area, take it to a printer and have them blow it up (black and white works better than color). As you slowly drive up and down every single street, use a yellow highlighter or I prefer a red pen and mark over top of the section of the street you drove.

Be watching for houses that look distressed (weeds or junk all in the yard, torn screens, paint peeling, etc) or boarded up props. If they are boarded up, nail one of your "I BUY HOUSES" signs on it. (I get more calls from these signs than any). If the house is fenced and chained shut, have zip ties in your Mary Poppins work bag, and poke holes in the sign and zip tie it to the fence. Make note of these addresses and when you get home look up the owner and their address and send them a yellow letter telling them that you would like to buy their prop. If you can't find the address or if your letter is returned, try knocking on doors of their neighbors. A lot of times they will know how to reach them. They won't usually TELL YOU the contact info but have your biz card handy and leave it with them so they can have the owner contact you. Leave them two cards-one for the owner and one to keep. Tell them if they send you any referrals that you are actually able to purchase their prop you will pay them "up to $1,000" (or whatever amt you decide) Then they will be more likely to keep your card.

When cruising through the neighborhoods be sure to have your magnetic signs on the car because then people know you aren't just casing the neighborhood. Before I had mine, I got some VERY suspicious looks. After a while, they will get used to seeing you because you should be doing this at least every two weeks. You can actually pick two different TZs and then cruise one every other week.

Let me know if you have any questions on this.

You are doing such a great job, Louis! It will happen for you! Remember, you are doing this "in spite of yourself"!

Karen

PS If I were you, I would jump on Bennie's offer and network w him! He knows his stuff and we finally got him talking!

I read your bio and you are really getting it done. Karen has some excellent advice and when you work directly with homeowners, you often can put as little as $1.00 down. Really it is all negotiable, although working with banks and other institutions it is a little more cumbersome. Best wishes!! Go drive the neighborhoods!

WOW!!!it's amazing what happens when you put your next foot forward regardless what your head or emotions tell you. As some of you know, I've been back to basics with Dean's book 30 Days to Real Estate Cash. I went back to the book when I was unable to move my first deal I had under contract. I was sure it was exactly what my buyers were looking for, but location, location, location. Even though the 3 unit would have generated $791 cash flow even after costs, the location makes a difference and in my area there's alot of cheap inventory. That led me back to the book and when I got to where I needed to find a realtor, I didn't want the fact that I did'nt have EMD to stop me from moving forward with a realtor. After asking for help here how I could protect a potential partner for EMD, I was finally able to meet with that potential partner tonight. I found 3 realtors to work with and will be doing 5 offers each per week until I can fine tune things and just choose one who best works with and for me.
I met with my EMD partner to go over my enter and exit strategy with her tonight over coffee. I've been going to our local Plasma center for extra income and as a result have built repore with some of the workers. 2 want a lease option house with 5-10k down and one is figuring out her criteria. The EMD partner I met with is also a employee there and has wanted to get in RE investing plus wants her own residence. Come to find out she is a trust fund baby and has a deep well if needed be and is now my partner not only for EMD, but also my new partner for buy, fix, and flip! Imagine that! Never judge a book by its cover and now I have learned that you never know where your buyers will come from. Hopefully she will the first of many once I get the flow in forward movement. I want to say thanks to everyone who helped fill in the gaps when I started this thread and another about having an EMD partner......
ONE STEP CLOSER.........Thanks again. Louis