All Forum Posts by: Nelson Del Castillo

@Courtney Feger what I learned is that mostly all banks have that clause in there addendum so if you are going to buy Reo’s you just have to take that risk. The best way to mitigate that risk is to order the tittle search before your inspection contingency’s are up so you have a way out if there is something going on with the the tittle. For the most part if there is a defect in tittle you will not be a able to get tittle insurance which would allow you to walk away from the deal but I believe there are instances where there might be something small on the tittle and insurance may still may be able to obtained.

@Jonathan Taylor Smith I’ll be using my own. What i did was extend the inspection contingency till tittle comes in and we can see what’s on it. If it is clear than are good to go, if there is something on there than I can cancel contract via inspection contingency. I just did not want to be 100% committed till we can verify what’s on the tittle, especially because this is a flip and when I go sell it, the buyers will want marketable tittle. If I had not extended my contingency, I would have been forced to buy no matter what’s on the tittle as long as the seller can get tittle insurance or loose my 5k deposit.

@Jonathan Taylor Smith insurable. Essentially the agreement states that as long as the lender can get tittle insurance than I’m obligated to move forward with the deal regardless of any defects in the tittle. They state that if they can get tittle insurance than that would mean there is no defects. I’m not an expert on this subject and don’t know if the seller has already had a tittle insurance company agree in advance to provide insurance. I’m ok with buying with insurable tittle but I’m not ok with having to buy if there is something on the tittle that would be expensive to clear even though insurance was able to be attained by seller. In other words, I have no way out if they can attain insurance for the tittle regardless of what comes up. They are saying that the insurance is the boundary line on wether or not the tittle is considered good or not. The way it’s worded really would put me in a corner if something came up. What are your thoughts? I could just be being over cautious.

@Christopher Phillips hey Chris, I know a lot of banks have that language in there but this particular addendum states that seller will choose tittle insurance company and that if tittle insurance is attained that regardless of what is on the tittle, buyer is obligated to move forward with the contract or surrender deposit. What makes me uncomfortable, is not being able to choose my own tittle insurance company. To be safe we are going to extend inspection contingency and order the tittle to insure there isn’t anything crazy on it.

I’m buying an reo and contract states seller is only required to convey insurable tittle. Is this something I should be concerned about and should I have tittle search completed before I give my full commitment and let contingencies lapse? This house would be a flip.

Hi, I’m under contract to buy a reo to flip using hard money. My attorney just notified me that the contracts states that they will only convey insurable tittle. Is this common, would I be taking any risk doing this? I have 5k down and contingencies expire today. Would you recommend doing a tittle search before letting contingencies expire?

@Thomas S. Good point. We will be selling the property. In this, the association would be protecting them self from a good tenant. Eviction is worst scenario, but probably not something that they would want to go through. What’s best case scenario, and what will likely happen? If I looked at and focused on worst case scenario on every deal, I would never do a deal.

I’m under contract to purchase a manufactured home do to close tomorrow. The seller is loosing the place do to taxes on Saturday February 2nd a auction sale will take place. My closing attorney last minute says we need association approval to move forward.. so we have under 5 days to get an association approval and close - that’s a long shot. I would close and worry about the approval after, when you buy a condo at an auction sale you don’t have an approval either and people do that all the time. Is the attorney being to cautious or is getting this approval that big of deal... Doese getting the approval out weigh some one loosing there home to foreclosure?

We will do everything we can to get it, but if we can’t, I would move forward and close anyways.

What are your thoughts?

@Meryl McElwain you can whole sale anything that is a deal. I buy deals at 70 cents on the dollar that are distressed and can’t be sold to a traditional seller. I can turn around sell that same deal to a investor who is buying cash or maybe doing the work them self at 75 to 80 cents on the dollar and he will be completely happy with that price. What is a deal to one person may not be a deal to another and vise versa. You can find these kinds of deals on the mls... as far as people preying on the elderly to steal properties, that is wrong, but not every wholesaler does this. There is honest people In this business who are truly here to help. If a home owners loosing a house to foreclosure and you can help them by giving them 60 cents on the dollar for the house so that you can make a profit and they can save the house, does that make you a bad person? No! A fair offer has to work both ways, which means I can make a decent profit with the property and it’s going to take you out of a sticky situation. That’s where deals come from, from problems being solved. Those who say that whole saler are taking advantage of people, is probably because they couldn’t figure how to be successful doing it.

@Gaetano Ciambriello thanks. I actually just spoke with them and he sound very knowledgeable