Got an offer on my house but....

[Allen Lucas]

Ok. So I have had my house up on the market a little over 70 days and I have only received one other offer from an investment group for well under the asking price. It's been taking so long and I really got tired of all the appointments for people to come in to look at my home and just pass it up. My agent couldn't do nothing more to help so I started taking matters in my own hands a little. 

I get a letter in the mail from a company called H.U.B Home and Realty Solutions saying they will buy my house in any condition, they will make an offer within 24hrs, and leave me with some money left in my pocket. So I decided to give them a call. Get on the phone with a guy and he says he wants to come see the property so I say ok. After checking it out he claims to like the house and that it needs some work. The next day he offers to purchase the house at the asking price of $205,000 all cash. The asking price is under the market value in my area. I was surprised but I knew there was a catch. He says that I have to take the listing off the MLS because he has an extensive list of buyers ready to go but if they see the listing on the MLS they will low ball me. That made sense but I knew that also meant I have to fire my agent. That was something I already wanted to do.

So I did what he asked. But now I'm extremely nervous because he offered me $205,000 but he(or his company) doesn't intend on purchasing it. He is marketing it to his extensive list of buyers while I get the offer contract reviewed by a lawyer. But I'm truly trying to figure out what was the purpose of his offer of he isn't the one making the purchase? Has anyone ever heard of this tactic? Is it legit?

[Shaun Reilly]

Yes, it is called wholesaling.

Do a search on BP and you will find approximately 18,473,665,734,221 posts on it...

IF you are selling enough under the market value that it will look like a good deal for an investor for MORE than you are asking then they could find an investor to pay you what you asked and will close quick with cash and won't care about the work.

Now since it WAS on MLS for a long time unfortunately it is likely they don't have an extensive list of REAL buyers that will actually consider it a deal. Unless you JUST dropped the price substantially when they offered on it (Maybe like $30-40K) these guys are most likely idiots that don't know what they are doing and are wasting your time.

Ask them for a large nonrefundable deposit and see if they are still serious.

What kinds of contingencies do they have?  If they offered cash obviously not financing.  Is there a long vague inspection clause?  Any other BS things like contingent upon "Partner review" or something again very vague that can pretty much get them out of it for any reason?

I'm actually in the minority here in saying it is possible to wholesale stuff that was on the MLS. However in your case (unless as I said you had just made a massive price drop) these guys are probably just wasting your time. While you can make MLS properties work it isn't at full asking price for any place that has been on the market more than maybe 3 days.

You said that price is well under market, but it does need some work.  Just making stuff up...  Let's say market is $240K if you put $10K of work into it.  The guy should have offered you more in the $150s if they wanted to sell it to an investor buyer and be able to make a spread on it.

Seriously get a good sized non refundable deposit...