The agency gets their money back… - Posted by Soapymac
Posted by Soapymac on December 17, 1998 at 14:11:59:
by first making sure that the home is under agreement with a ready, willing, and qualified buyer.
In the Purchase and Sale agreement there would be a paragraph stating something like:
“The seller assures the buyer that the property will pass the Title V inspection prior to closing. It is estimated that reapirs to complete the requirement will be completed by (put date here.) If, because of events that the seller cannot control, the repairs cannot be completed by that date, then…” and here you would put the agreement that the seller will still be responsible for the cost of repairs even if it was after closing.
The RE company now advances the money, and PAYS THE CONTRACTOR upon completion. The contractor signs a mechanics lien release, which, combined with a satisfactory inspection report, is brought to the closing.
At the closing, the paperwork for the Title V is completed, the documentation for the no interest loan is placed as a charge to the seller’s net, credited to the broker.
Yes, the paperwork is a little more complicated than what I’ve described…but you get the idea.
Seller is happy. Buyer is happy. Broker is happy. Win/Win/Win!
Now, think about it for a minute. IF (big word) you have the money available, and you have a “deal killer” facing you, and it’s a good proposition otherwise, could you get the technique to work for you…as long as you had a note secured BY THE PROPERTY in case the sale still did not go through?
Yeah, you have to think about it. But isn’t part of being an investor having the ability to solve problems creatively?