There’s alot of Buyer Look-Alikes out there these days. If you’re new to the wholesaling business, then these artificial buyers could potentially trick you into locking up your deal without ever having the intent of closing. Or even worse, they could WASTE YOUR TIME!! ERGHHHH that makes me so mad.
So just for you, I’ve written this very smart article that should help you identify what your REAL CASH BUYERS will look like. When I Use the phrase REAL CASH BUYERS in this article, I’m referring to CASH INVESTORS who are looking for DEALS, who are ready, willing and able to CLOSE on a contract themselves. These are the types of buyers you should be after.
- REAL BUYERS DON’T NEED INSPECTION CONTINGENCIES. That shit is for retail buyers. A bona fide cash buyer will come in, look at the place, poke around at a few things, make a YES OR NO decision, and then sign the contract. They won’t add a “10 day inspection” contingency and then start trying to renegotiate the price because the roof leaks.
If a buyer wants to do an inspection, I tell them to go ahead and do whatever they need to do before they sign my contract, but in the meantime, I’m going to call a few other buyers. I don’t have time to tie up my contract for 10 days while some tire kicker hems and haws about a crack in the foundation. Put on your big boy pants and make a decision.
- REAL BUYERS DON’T NEED 30 DAYS TO CLOSE. Real buyers that have cash can close tomorrow. Unless their bank is located off shore somewhere and they need to catch a ferry boat to get a cashiers check, then there’s no reason why someone who is paying cash cant close in 3 days. No reason whatsoever.
In the event that your buyer is using hard money or private money, they do take a little longer to close. They wont show up at the drop of a hat with the monies. So if your buyer is using a private lender, then 14 days should be sufficient time to get to the closing table.
- REAL BUYERS WILL PUT UP A NON REFUNDABLE EARNEST MONEY DEPOSIT. All of my contracts with buyer require a $2,000 Non Refundable Earnest Money deposit paid to my company at the time the contract is signed. if you get any resistance from a buyer about this, then you should put this buyer on red flag alert IMMEDIATELY. Never, and I mean NEVER let a buyer lock up one of your properties without an Earnest Money Deposit. That should be paid by cashiers check, cash or money order only. No personal checks. They bounce.
Recently, I got a little creative and accepted 2 clear titles to vehicles in lieu of an Earnest Money Deposit. The buyer is using a private lender, can close in 14 days, and put up the titles to his vehicles. So can you get creative? yes. Can you sign a contract without some REAL consideration from your buyer? NO Under no circumstances.
- REAL BUYERS DON’T CARE HOW MUCH MONEY YOU MAKE. There’s always going to be that shmuck who asks how much money you’re making on the deal. You need to kick his ass to the curb. First of all, its none of his business. If you’re offering the property at $x.xx and he wants to buy it at that price, then your profit is irrelevant!!!! If he has a problem with it, this isnt a REAL BUYER that should be on your list. Give him the whack immediately and move on to the next guy. Real Buyers only care if they numbers are going to work for them or not.
Hopefully when you hear any of these warning signs come out of someone’s mouth, you think of me and immediately identify that you don’t have a REAL BUYER on your hands. You have a tire kicking time waster.