Wow I couldn't believe my ears. I was in Atlanta last week, learning some new real estate investing tips, and Theodore was telling me about how he had been ripped off for $20,000.00 one time and $60,000.00 another time on real estate deals he had been working on. (by the way his name was changed to protect the guilty---ME lol)
I asked him to tell me what happened and he said that he had set up two out of town deals and had and investor in the town where the deals were, taking care of everything and getting the lions share of the profits. On both of the deals the "helper" was even making more than the Theodore! Over the phone-with a verbal handshake-the deal maker (Theodore) set up the deals and thought that since he was handing the deals over to someone else just to make sure all of the paperwork was taken care of....... AND giving away the lions share of the profits that no one would even think of ripping him off! Gee-wiz, if someone called me on the phone and asked me, since I was in the town where the deal was, to make sure that all of the paperwork got done and all of the loose ends were taken care of and gave me $40K for my trouble.....and the deal-maker was only taking $20k....well, ah...I'd kiss him on the lips and be very very happy to help him. Well...I maybe wouldn't kiss him on the lips....but you know what I mean.........such a deal!
SURE I'd help.
So, needless to say Theodore's' friend didn't help Theodore.........he helped himself.......to ALL of the profits and sort of disappeared with all of the cash. I didn't ask how the contracts were written up or what kind of deals they were. All I know is Theodore didn't seem like he was making up the story because he really looked hurt as he relayed these stories to me. How can anyone do that? Man, if someone asked for my help from out of town, I wouldn't need to take the lions share of the profits. I'd help them for a whole lot less than Theodore was willing to pay. It sounds like a great long-time business/partner relationship forming to me.
Anyway, to make a long story short, when I got back to my office I emailed Theodore a copy of an Affidavit and Memorandum of Purchase and Sales Agreement. This is a neat little tool that will help you get paid when you have any interest in a property.
So what does this have to do to me you ask? Well.......what if the next time you tie up a property your new seller gets a call from another investor, after you leave with a signed contract and says, "hey, I'll give you more money and close sooner than that guy you just signed with." What is your seller going to do? Your seller is out to get the most money, the soonest, from their property right? So whether they know that they can't do this legally or not, they go ahead and sign with your competition, and he does closes ahead of you. Now you have been marketing the property, spending money on advertising and talking to everyone, and their brother, about flipping the subject property......... that has already closed and already belongs to someone else! What are you going to do? Nothing! You weren't covered...you weren't protected.....you just tried to help a total stranger and believed that they were going to do what they said they were going to do on their end of the contract. Ahhhh, to live in a perfect world with totally honest people......one can only dream.
It's a pretty simple form and not hard to fill out. All you need is the property address, your name, your contact info, the sellers name and a notary. That's it. For about ten dollars to fifty dollars, depending on how greedy your county is, just fill in the blanks and file it in the county where the property is. Voila! No one can buy or sell that property without you being contacted because this little paper says "you have an interest in the property" and the title company or the lawyer has to talk to you before the buyer gets a free and clear title.
So the next time you buy a property or tie it up with an exclusive option to sell, just take a little insurance policy out, for your time and trouble and the marketing money you are spending. Just fill out and file this handy dandy little piece of paper to make sure that you get paid for your work. It's no fun working and spending your hard-earned cash just to have the fruits of your labor go to someone else. So don't let it happen to you.
While I have you here, I have a nationwide source for hard money (and just about any other RE deal you have) that you might be interested in. If you find yourself a little short after finding a killer deal, give us a shot. Yes I know that it's a little expensive but what are you going to do? Let someone else make the 5, 10 or 20 thousand dollars or more on the property you've just found? Or are you going to be the deal-maker and satisfy both the buyer and the seller needs while getting your slice of the deal for putting then together? You and I both know great deals don't come around everyday. So why let any of them go?
Just click here or head over to www.privatemortgagelender.org/ and let me be of assistance to you with fast and friendly money to close those once a week, once a month or once-in-a-lifetime deals. You'll be glad you did.
Here's to your happy and profitable investing.
