Selling Your Greensboro House To An Investor
The word “Investor” has become infamous for lowball offers and not doing what they say, although working with the right company can help you sell your house without hassle.
Here’s what to look for in your offer.
- Non-Refundable Due Diligence Money
- Are They the End Buyer?
Protect yourself by asking for non-refundable due diligence money. This is money that the buyer puts up at the time of agreement to honor that they are going to close on the property. The more due diligence, the more the investor has to risk if he/she backs out of the deal.
By now you’ve been called by dozens of different “Investors” although their intentions may be to resell the property. Ask them if they will be the end buyer or looking to assign the property to an investor.
Lets take a look in depth at what you can include in your agreement to make sure you are protected and that the end buyer will not back out when selling your Greensboro house.
What is Due Diligence $, Earnest Money & Assigning Contracts?
Due Diligence Deposit – Non Refundable Money that is put up at the time of meeting of the minds on a price & terms for the given property. This money is given directly to the seller from the buyer and is intended for the buyer to have a period of time to do his / her own due diligence which may consist of inspecting , appraising, getting quotes on the property.
The due diligence period is a time for the buyer to do a more in depth search to make sure the house is in the condition the buyer expects. During this period, the buyer might negotiate or ask the seller to complete any necessary repairs. Due diligence periods can range and are negotiable between the buyer and seller.
Earnest Money Deposit – Similar to Due Diligence deposit, this money is refundable and is held in an escrow account either with the agent or attorney closing the house and is normally larger than the due diligence deposit.
Once your due diligence period is over and the buyer wants to back out, the due diligence and earnest money would be at risk. This is why doing inspections, research and getting estimates are important during the DD period so there can be fair negotiation without the risk of forefiting this earnest money.
Assignment of Contract –
How To Be More Protected When Selling Your Greensboro House
Max Maxwell, CEO / Founder of Cash Homes Triad and Venture Atlas LLC recently sold a property to me after he took it off the market.
Max had a hedge fund buyer ask him to do over 5k in repairs during the due diligence period and was willing to forfeit the due diligence money if he did not make the given repairs.
I had offered a similar amount, without inspections or appraisals and put up $3,500 for due diligence meaning that if I were to back out of the agreement I would be paying Max $3,500.
Knowing that the buyer would forfeit $3,500 if they backed out, would this make you feel more relaxed during the whole process?