Non-MLS Deal Process

[Danny Day]

I've decided I'm done looking on the MLS and submitting offers at or around 50-60% of the list price.

I'm going to start marketing to pre-foreclosure / distressed home owners. Can someone give me the break down on how the deal flows once you have it under contract?

I assume that you use your own contract stating that if the title search shows existing liens you can opt to back out / re-negotiate?

The way I see it..

1. Make offer
2. Offer accepted / executed contract
3. Option period / Earnest Money period
4. Open title
5. Verify its a clean title, if not re-negotiate for liens / removal of liens
6. Appraisal (after you know the liens are removed)
7. Closing

My reasoning for the appraisal after the title search is that the appraisal will cost me out of pocket $500. The title search I can get done for around $150. If they are not willing to come down on the price with existing liens, I want the option to walk away with less out of pocket.

Also, do you do inspections with a licensed inspector? I can get that done for around $300 and he always points things out that the next inspector will find.

Last but not least, do you do all the legwork for payoff request, short sale approval, loss mitigation for the home owner? The reason why I am concerned about this, is that I am a licensed real estate agent in the state of Texas. I am going to write a page that discloses that I am a licensed real estate agent in Texas, and I do not represent them or their interest in the transaction.

Sorry for the long post, but I just want to cross my T's and dot the I's before I get one under contract.

Thanks in advance

Danny