By Lee Arnold
You’ve found the perfect distressed house to invest in. The owner wants to sell it to you low enough that after you put the estimated cost of repair in it, there’s still plenty of room for profit. What do you do next?
a) Shop for funding.
b) Start a bidding war between lenders.
c) Start demo, the house is as good as yours!
d) Put the property under contract.
It might seem ridiculous when you look at it as a multiple choice, but you would be surprised how many people make the wrong choice every day.
The first and most important part of securing private money is getting a property under contract. The biggest mistake you can make is shopping too early for the money, yet we see it all the time.
As a private money lender, we see this scenario too often:
An investor comes to us, excited about an incredible deal. They’ve learned all about the property and are now on the hunt for cash. They have done ALL their due diligence, but they are missing the most important element to get the funding channels flowing; they haven’t secured the deal yet.
Without putting the property under contract, they have nothing to go on and no lender worth their salt will entertain the application process on a property that isn’t under contract. Why? Because as long as the property isn’t under contract, it’s up for grabs by anyone and everyone, and any time spent on that property is wasted if the house is snatched up by someone else whose priority is getting it under contract.
Don’t let this happen to you!
Getting a house under contract is easy with these four simple steps:
- Prospect and review potential properties
- Write offers
- Get offers accepted by the seller
- Put earnest money in escrow to complete the contract.
Once you’ve completed these four steps, you have a fully executed purchase of sale agreement, the property is under contract, and you are READY to shop for cash.
Getting the cash is usually the easiest part. We shepherd you through the loan process and each successful loan you do with us builds your reputational capital. Once you’ve done one successful deal with us, the next one is even easier and each one after that feels like a piece of cake.
We’re looking forward to working with you on your next loan. Get that property under contract and then get a hold of us so we can help accelerate your real estate investment success!
If you have a deal already under contract, visit us at www.cogocapital.com/quickapp to fill out your fast application and get your easy quote today.