In what I am thinking: The most ‘feeling good’ land agreement of which we have been part since we entered this industry (and an advantage of being quite profitable).
The 8 -month title nightmare that almost broke us
At the end of 2024, we beg he Most messy title situation I’ve ever seen.
“Simple” is probably a scope. The package crossed through a county line, adding jurisdictional complexity, and was a real estate agreement, but the seller seemed to be the only holder of the title with organized family documents. Two local title companies could not obtain their subscribers on the finish line, citing unclear family records (EC, surname distributed in a marriage certificate of the 1920s (!!))
VAT, this was after we had already spent $ 3,500 in a survey, under the assumption that the title would be clarified, a decision we regret.
With a purchase price of $ 110K, the capital risk was too significant for us to consider the title subscription by itself, so, as Hail Mary, we communicated with the company of disorderly titles most specialized in TX, and still tigua.
There were times of this process in which I was prepared to cancel our hard costs and move on. Our land inverter partner deserves a mass loan here, an unpleasant amount of time passed by working with the seller in Genealogy Research to find the documents that the title needed.
Finally, after 8 months of back and forest, all that remained was for the seller to sign the final documents. And the day of the closing, the seller calls an investor partner from the country and Tearully said he needed to reschedule with the title company and then ghost us.
It was an impressive turn since the seller had a leg cooperative and anxious to close for months, helping to corner family members to sign several sworn statements of wound.
We had approximately $ 5K in hard costs at that time, in addition the market had worsened that we started working in this agreement, so it is limit in the best case. Therefore, we had to weigh carefully if we were going to walk or invest emphasis on legal remedies if necessary.
I cover how we handle this situation in more detail here. Suffice it to say that the seller returned to the closing table, and we officially close earlier this week.
Total costs: ~ $ 118k. The plan was to list a little less than $ 260KUnder the market, and probably is not sold for a sausage case of less than $ 200k.
The change of 7 days: from ghost to $ 230k in cash
A few days after we touched the title, our land investor partner listened to a family member of the seller who indicates that he was interested in buying it.
I called the family member and he declared:
“I really can’t believe this property was sold. It has a deep family history. If I had known, I would have approached my cousin to solve something.”
If it was not clear from above: even if I had known, there is a possibility of almost zero zero that may have closed this agreement, give the work of an extremely complex title and the fact that two local teammates had to renounce the cleaning title.
Althegh had no prior awareness of the family history of the seller, it was clear that they are African American and that the property has been in their family since slavery. Originally they were part of a plantation on which their family spoke after emancipation. We are talking about almost 200 years of family history.
(Note: I discussed, including the above, given how hot anything related to the breed is in the US.
I am sitting there in silence, letting him tell his story, trying to discover what space there is to work.
Hello, sacrifices $ 200k in cash to keep it out of the market.
That is much lower than I am willing to consider. We still tried the market, and I am sure we have a price below the compensation at $ 260K. But I can say that this guy has a serious emotional attachment, and it is worth listening to cash buyers who can close in 30 days.
After arguing with our land inverter partner and waiting for a couple of hours to see if the potential buyer would return and anchored higher, I sent him this exact text (and also sent to his email for an embedded visibility):
“Hi sir [Last Name]Is Chris, we talk about him [Address] Property.
Discuss with my partners, we are understanding the meaning/story that property and your family have and we would love to come out.
If you can meet with us in the middle at $ 230K in cash, 30 days of closing, we are willing to sign a contract before it reaches the market.
We can give it until noon CST tomorrow so you can sleep and make any call you want.
After that, we will begin to market it aggressively, given the time we play to buy pursue the package.
Don’t worry if you don’t work for you, I just wanted to give you the option and don’t hesitate to call me.“
Emotional recognition effect, specific number, hard deadline (but not crazy pressure).
The next morning at 8:30 am, he calls me, appreciating the sacrifice, then tries to counteract $ 225k.
I hero signs, knowing that $ 230k was the lowest we would consider before reaching the market, and I told him that if it reached $ 230k, I would sign a contract today.
Then I was silent. Our Batna was excellent and we thought I was going to do well in the market. (In addition, $ 5K were really going to be a decisive factor?)
Buyer: “$ 230k, it’s fine Chris, let’s sign.“
Before calling our corridor, I already had the buyer enclosed verbally. Then I renegotled our commission of the 6% list since we had brought our own buyer, and we recognized all the work he had done in the agreement during the previous months. She agreed, they all pay us quickly. Super hard acquisition, easy album. I take it.
Anticipated result: $ 100K net profit divided with our land investment partner. Eight months of work, but only ~ 30 days of complete capital deployment.
And here is the part of ‘feeling good’: this is the family that has administered it for generations (with a clear title), and we obtain a solid return our thorough persistence. I will forget this story in the short term.
5 lessons that created $ 100K in a week
- Solve problems that others won Touch. It is not surprising why several land investors have revolved their businesses to incorporate outdated titles offers (and we want to finance more!). The market is more difficult. It is more difficult to come due to fruits of low improvement. And creativity and persistence lead to survival.
- Avoid hard costs until the title is clear (when possible). As mentioned above, we regret committing himself to an exhaustive survey about the assumption that the title was going to clarify. Sometimes it is a balance of thought thinking and other field work can have extensive deadlines, and must have to do that against the urgency that the seller expresses himself to close.
- Recognize emotions behind people’s wishes. There was a clear and obvious emotional attachment that the buyer had on this property. Look how I wrote the respectful text message. There is no forceful language, and we both return to the negotiating table in our NNN agreement. Is it surprising why we could solve a mutual result of this benefit?
- Extend the rewards. As previously, we try to make hardball/squeeze our corridor, just although we locate a buyer on our own within a few days after the purchase of the property. In addition, he quickly prepared a contract and played on Title Co. Logistics, which adds a sense of professionalism and trust that most buyers appreciate in our experience.
- Never tell your chickens before they hatch. Duh! While we would love to take buyers in your word (especially buyers with deep files attached to property, such as the above), we do not cut any contractual requirement. We require that an EMD and a proof of funds be sent to the title company within a few days after obtaining contracts (this buyer sent both).
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