The Character of your Home-Buyer

“Character is like a tree and reputation is like its shadow. The shadow is what we think of it; the tree is the real thing.” — Abraham Lincoln

In a time bursting with information and technology like social media and Google, it is easy to become distracted so that we confuse what is the tree and what is the shadow.

In the fast-paced world of real estate, character and accountability play a crucial role. Unfortunately, it has become increasingly challenging to ascertain the true intentions of the individuals or businesses involved. The days when a simple handshake or a person’s reputation carried weight seem to be long gone. In today’s landscape, every aspect of a real estate transaction demands careful scrutiny, thoughtful consideration, and thorough questioning. After all, buying or selling property is one of the most significant financial decisions anyone can make in their lifetime.

The importance of working with someone you can trust cannot be overstated. While the legal profession provides a certain level of oversight, the broader real estate investing realm lacks regulatory bodies that can step in when a deal goes awry. This reality can be quite daunting for both seasoned investors and first-time buyers alike. It underscores the significance of thoroughly vetting all parties involved, conducting extensive due diligence, and relying on professionals such as attorneys who can offer guidance and protection in complex transactions.

Ultimately, ensuring a successful real estate transaction rests on the shoulders of those involved. It necessitates careful examination of the characters, intentions, and reputations of everyone participating. By placing a premium on trust and accountability, individuals can navigate the intricate world of real estate with greater confidence and achieve their desired outcomes.

So, to help protect themselves, here are 2 important steps that an individual can take before entering into an agreement with a real estate investor or home-buying company:

1st Investigate! Experienced and established real estate investment companies are going to have a strong online presence and should be fairly easy to look into. Check out online reviews such as Google or Yelp. The Better Business Bureau is a great resource as well. There, you will find not only reviews and whether or not the company or individual is BBB accredited but also other valuable information such as the organizational structure of the business and longevity of the entity. Business history is important. You want to work with someone who is experienced and is a full-time real estate professional. Because of the lack of regulation and accreditation for investors, anyone can “hang out a shingle” in their selfish hopes of “getting rich quick.” Therefore, make sure the individual or company that you engage to purchase your home has the experience and knowledge to complete the sale! 

2nd Inquire! Ask questions in regard to the investor’s plans for the property you are selling. Are they going to be the end buyer, or are they wholesaling the property to another investor? If they are the end buyer, what is their purchase plan? Cash, financing, or bank line of credit? Do they work with a professional title company to facilitate the closing and title work? Ask for references, and if “paying cash,” ask for proof of funds. You’re NOT asking too much!

Although certainly not an exhaustive list, and this should not be construed as legal advice, here are a few red flags to look out for:

– The investor doesn’t use a standard AREC (Arkansas Real Estate Commission) contract and instead uses a contract he or she has drawn up. This means they are not using an agent, as only licensed agents are allowed to draw up the standard AREC contract.  While it is not inherently concerning for an investor to work without an agent, the use of a non-standard contract may be of concern, particularly regarding the level of protection it offers to you as the seller.

~ Vague answers to questions regarding the investor’s exit plan.

~ Refusing to work through a reputable title company.

~High-pressure tactics, “If you don’t sign this contract by 5 pm, I’ll rescind my offer.”

~A long option/inspection period (more than 14 days) on the contract.

The bottom line is that you should enter into a working relationship with someone you can trust. Someone who has the character you demand to purchase your home. In an industry that is unregulated, it is important to take the proper steps to learn who you are working with, not who they say they are, but the actual tree of their character and the fruit it produces.

Finally, to protect your interests, it is always advised to seek independent legal advice from a qualified real estate attorney. 

We’d love to answer any of your questions! Fill out the form below and we’ll get right back to you.

The post The Character of your Home-Buyer appeared first on Sell My House Arkansas.