Write a Winning Purchase Offer
Oct 16, 2017 / Fix and Flip
When it comes to buying properties it’s imperative that everything about your fix-and-flip company exudes professionalism, which includes the offer you’ll write and present to the seller.
If you’re still working out the details, it’s fine to write a one page proposal outlining the price and brief details of the offer; cash offer, amount of earnest money, closing date, commission if any, no physical inspection, etc. Once the details are hammered out, time for a formal offer.
I’d suggest working with your real estate agent to write the offer – he/she won’t get paid a commission on the purchase, but will be happy to work with you knowing they will have the back end listing(s).
Follow these tips to have the best chance of a signed contract with the seller.
Professionally prepared offer.
Sloppy offers show sloppy business practices – the offer should be professionally prepared, legible and on a state approved contract. (Hopefully your agent or attorney is preparing the offer)
Pre-approval letter or bank letter (verification of funds)
Attach to the offer, specific to this offer. An offer or letter of intent without proof in your ability to close should be quickly discarded by any seller – make this easy for them, show them you’re ready, willing and able.
Earnest Money – Real offers include real money.
A check should be attached to any offer… of course in many cases if you’re working with a property owner directly (not listed), you’ll make this check payable to your title company. But the attached check shows the seller you’re serious.
Waive as many contingencies as possible.
Physical Inspection – Loan Approval – Appraisal, etc. This is your advantage to the seller vs. the seller working with any other potential buyer or realtor wanting a listing that comes along… You’re again showing you’re serious about the property and won’t be back in a week or two or three to beat the seller up for more money on inspection items, etc.
The ability to be flexible with the seller on a closing date.
What if the seller is concerned about his tenant(s) finding a replacement home, etc. | or needs additional time to clear out his mother’s belongings, etc., or a divorce with some unknown dates. Be compassionate and flexible in your extending your closing date if the seller needs it.
The ability to take the property "as-is, where-is".
Allowing the seller to pack (or not) and leave. Don’t worry about cleaning up the property, don’t worry about the old tires in the back yard, don’t worry about that leaky sink, etc. What a relief to the seller to know he only has to worry about getting out, and moving on to the next phase of his/her life.
Finally – What else can you do for the seller to help?
Jeff Hammerberg is a Real Estate Professional / Fix and Flip Contractor and President of FixAndFlip.com - The Nation's #1 Source for tips, products and education geared toward ensuring your success in the fix-and-flip business.