Well, if you read my last post you probably know what I think about most real estate gurus. I do believe in that a strong team can save you a lot of money, but it doesn’t happen overnight.
For House #16, we put it into escrow on Tuesday. Last week I sent a informal counter-offer to 5 out of the 8 offers we received. Basically, explaining how we do things, what we are expecting and what will help their offer stand out above the rest, since the 5 offers all netted us within $2,000.
The three things that would help their offer stand-out:
1. If the Buyer is willing to pay their own closing costs. Since we deal mostly towards an FHA clientele, this is always a tough one.
2. If the Buyer would work with my lender. This is pretty self explanatory, but important.
3. Escrow must be Seller’s choice. This is also pretty self explanatory and it is pretty common for the Seller to have their pick of services in this market.
Surprisingly, only two buyers responded. One raised their offer by $5,000 and the other offered to raise their offer $5,000 and use my lender. All other things pretty much being equal, you can probably assume which Buyer we choose to work with.
Now the fun parts, this is where things get easy:
1. I call the lender I use and ask him to schedule an appointment with the Buyer and pre-qualify them.
2. I call escrow and let them know the address and the details.
3. The next day the lender calls me back and lets me know the Buyer is easily qualified and he has ordered an FHA case number and had the appraiser give him a verible that she can get the property to come in at contract value.
4. The lender ordered a second appraisal from day 1, so we will not need a review appraisal. Some banks allow this, since he is the branch manager with a direct lender, his bank rolls with this.
So now we have an escrow with many of my team-mates involved. If anything goes wrong, I guarantee their loyalty lies with me and they will not delay things.
How did I build this team? Along the way…
1. My escrow lady did a couple purchase transactions early on and simply asked for my business. I gave her a chance and have not looked back since (probably 30+ escrows later).
2. Title Insurance I never really get to pick, since I buy Title Insurance Binders that the Seller pays for when I buy property.
3. I have had quite a few loan officers “ask for my business,” this is my second time referring this one a loan, so we will see how it works. This is always the hardest part to push people on. But, always, always, always call the loan officer before you do a transaction! You ask them many important questions: “are you a direct lender?;” “are you investor friendly;” “what is the time-frame for a typical transaction;” “how are appraisals ordered;” “how often do review appraisals get ordered, and how;” “what will be the major hurdle for this loan;” “when will you have desktop underwriter approval;” “can you send me a copy of doc and funding conditions when you receive them;” etc… Can you tell I ask a lot of questions?
4. The appraisers used are usually part of the lenders team, but they often-times do lenders favors. So, if the lender wants to impress you, they will help protect you from the bad appraiser.
I think it is very hard to build a lot of these team members before you actually start doing transactions. Everyone wants business, but it is really hard to see how you work together until you do a couple transactions with a person.
Now just for fun, here is the final walk-through of House #16