Write my own offer?

Question

Hey BP, I would like to ask some recommendations from other investors. I have spoken with an owner for a property that he is willing to sell for 185k. He doesn't want to use an agent due to the commission he would have to pay. I spoke with a buyers agent who said they would charge 3k to represent me? I am assuming that just involves submitting a purchase agreement? Would I be better off writing my own purchase agreement? This is in Florida by the way, I'm not sure if there is anything state specific involved here. Thank you!

Ceasar Rosas · Answer

@Kellen DriscolIs the property a deal for you, have you done comparables and know what you are doing?Have you negotiated the deal to the best of your ability?Are you abreast of that market and know the ups and downs of the area/neighborhood? Have you bought property before?Have you done or scheduled a home inspection? Etc..... If you answered yes to these questions then I would probably just hire a RE Attorney to make sure you have contracts that work for you and that you have an out. I'm in NY and an attorney would charge you about 1500, in PA where I flip properties an attorney will charge me 585. Weigh your options, and I'm a broker telling you this.

Christopher Blanco · Answer

I use my lawyer to write offers. He charges me between $500-$1000 to write the offer and submit it and all the other requirements into Title. This is a good deal as my RE agent will charge me a % of the sale. First time ever a lawyer is cheaper than anything else. :) Actually, what I do first is write and get the buyer to sign a letter of intent to purchase the property. In the letter, on my business letter head, I lay out my offer (usually there are 3-5 offers depending on the situation) in plain English. I find this is easier than walking though a buyer legaleze . Once the buyer chooses the offer they like, I then have my attorney draft the legal purchase agreement to reflect the terms in the offer. This seems to work pretty well.

David Zheng · Answer

If you have done several deals in the past, it might not be bad to write your own offer. I did 7 deals through agents, watched, and asked a lot of questions. My 8th deal I did completely on my own through a private sale and yes it was financed. It went swimmingly well and I was able to drop the price from 330k to 250k on my own negotiating terms. the biggest potential headache is with title and luckily the title company takes care of all of that, so you shouldn't really need to worry. and the sales contract? that little $10 3 pager from Office Depot served me well :). (and it comes with 10 copies heh)

John Thedford · Answer

3K is not a lot to protect your interests. Have you looked at the property? What are your concerns? Even using an agent, I would want to put eyes on the property.

Eric Andrews · Answer

It depends, but if you're not quite sure what you're doing yet, it's much better to have an agent represent you. After finding a property, writing an offer is really the first and easiest step to purchasing a property.

Kellen Driscoll · Answer

I have decided to use a realtor if you all are curious!

Kellen Driscoll · Answer

Thank you all for the responses!

Claudette Attride · Answer

@Kellen Driscol:Congratulations on a possible great deal; just adding my bit, I am sure your Seller is an honest motivated person. I am always encouraging doing your own due diligence work- Florida is great for letting 'your fingers do the walking' since I you are in the great state of Massachusetts use your computer to access the relevant Florida county's website and check out the property. You should look first at the Deed and see your Seller's name and how he owns it- sole or joint, to save time negogitating with the wrong person; then cleck the tax history of the property- to see it is up to date; and then HOA history and/or city liens if any. Always do your own due diligence first, and yes, I would recommend an agent to 'hold your hand' through this. Note: I think it is always good to know WHY a person is selling! It helps you to decide if you are willing and capable to deal with the issue that caused the sale. Good luck.Claudette

John Thedford · Answer

Don't forget an inspection!

Jacqueline Mann · Answer

I agree with Caesar Rosas. If you're experienced, you could just use an attorney to do the paperwork, but if you need eyes on the property or if you're still getting your feet wet in investing, then by all means use an agent. My agent's advice helps make the process smoother for me, and he educates me along the way.