Wholesaling: Walking buyers through the seller's house?

[Drew Byrd]

I'm still learning how to wholesale and have not yet made any deals. Imagine this scenario, tell me if this has happened to you, and how you responded. You're bringing potential buyers through a seller's house to show the the condition, expected repairs, etc. The seller deduces that one of these people are someone you might sell their home to, and they begin to wonder why they couldn't have sold their home to one of these buyers at a higher price than they are selling it for to you. The seller gets angry, feels as if you've cheated them, and wants you to rip up the "option to purchase" contract you sign with them.... What should be done in this situation/what can be done to avoid it in the first place?

[Bill Gulley]

@John Thedford, sorry I've been gone awhile.

Guess I got tired of beating a dead horse but thought I'd check in to see what's new........no much it appears, LOL

Thanks for your comment, I just don't know where that thread is concerning types of fraud, but you pointed it out nicely.

Since Mr. Pratic P. (@Pratik P.) doesn't want to argue about his poor answer, (not beating that dead horse again) I'll describe "partner".....

So, the seller is to think you have a "partner" (ha, more deception)..... so what is the owner to think?

Is he your beer drinking partner, your hunting partner,  fishing partner, your bowling partner, no because the way you used the term "partner" was in a business setting, like your money guy, a business partner. So now the owner believes he's working with a partner of a partnership.....logical conclusion and I'd bet any judge would agree.

So, now you have legally implied a business partnership to the owner!

Not knowing beans about partnership law and claiming to  have a partner can be dangerous for you and your unaware "partner" but especially for you. You''l need to know about specific consent and implied consent, duties of an agent in an partnership or agency relationship......but most aren't aware of simple business law matters.

Claiming or even implying that you have a business partner when you do not is deceptive dealing, fraudulent dealing, you lied. 

If the real potential buyer (your fairy tail partner) never consented to a partnership, formally by agreement or verbally to consent to your arrangement, eventually he can get out of your web of deceit, but in doing so he will spot light you as acting without his consent or knowledge and by saying no partnership ever existed. 

That just puts liar fraud mud all over your face.  :)

Need to understand that a partner can be liable for the contracts,  acts or omissions of the other partner.    

Don't ever say that you have a business "partner" when in fact you do not, you can claim those other partnership relationship as you please.  Judges will not like that at all!

The truth won't  hurt you.

Mr. Owner, I buy houses and sell them. We generally try to improve them, rehab them and put time and money into our homes, sometimes we sell them as they sit to  other investors we work with.

We try to keep a list of potential buyers and we may show someone what we are trying to buy after we have a contract. This allows us to decide and plan on the types of improvements to make, just as a builder works with their client in building a new home. We are always working with buyers to give them the type of home they are wanting.

At the same time, I work with owners to give them a fair price and quick closings. So, Mr. Owner, if we can come to a fair and acceptable price is there any reason you can't sell to me? (heck no!)

If the home is vacant,  we ask that after contracting we have access to the property for inspections and determinations by our clients. If it is occupied we will arrange entry by appointment only. 

Now, I'm not telling anyone that in saying such a thing keeps you out of the issues of "showing a property to another potential buyer!" Because you're still showing a property you do not own legally.

However, if you learn how to close a deal in your name and then sell and you can show a pattern of buying and selling,I doubt any regulator would violently object if your buyers were asking that you add a deck, new cabinets and appliances while specifying colors.......but technically, you are not to  advertise or show real estate that you do not have legal title to;  exceptions, acting as a licensed agent, estate settlements by the administrator/executor or with a power of attorney under specific directions and not for profit.....states may vary. 

Lastly, the OP's question; By giving sufficient consideration for the Option to Purchase, money binds the obligation under the contract. 

BTW, wholesalers who don't have the intent or means to  perform as agreed do not have a valid contract, so don't push it, if you're unable to perform and the seller wants out, smile and say next!        :)