We just closed a probate home Monday which was another fantastic situation where I was able to really help an Administrator who had much more need then just selling her brothers home. I had some shady real estate agents do some crazy things to try to grab this business but as usual knowing the Probate Procedure prevailed for me and I just closed earning a $24,500 Fee and also a $2600 Loan Referral from a $425K sale.
We first came into contact with the Estate by researching the file the week the Estate Attorney opened the probate file. We made contact with the Administrator and after some options and clarifications she wanted to meet with us. At the meeting we went over her options and she decided she wanted a fast, As Is sale as they wanted to move to Nevada as her husband was taking a new job and they wanted to purchase a home with the proceeds from the sale of her decease brother. She was the only heir.
We brought our investor in and sold the property for $450K with an upside of $550K to $600K after rehab as it was a fixer. The estate was happy and we opened escrow. All through this other agents and investors called and tried to blow our deal with outrageous price quotes for $500K "As Is" and that they should be on the MLS. They didn't know the house (never visited) and they didn't know the administrators situation and preferred course of action (Fast Sale As Is). During escrow the reports came in and the Pest was out of this world with a $50K report plus the studio over the garage could not be a rental only a 3rd bed and could not have a kitchen. With Cosmetic work (which we knew the costs upfront from our project manager) and the Sewer Lateral and Home Inspection the rehab would be $100K and blew our deal out with our flip investor.
The Administrator understood upfront that the offer was subject to the reports as we had no way of knowing upfront until reports and the buyer(s) would not pay for reports until in escrow so we had to sit with the Administrator and go over numbers. This resulted in a best price the estate would take of $389K Net plus our fee, so around $409K. This wasn't going to work for the estate so we canceled the sale and looked for a landlord or retail buyer who could pay more. This was how we operate so there was no surprise to the Estate when this happened as we had prepared them that everything would be based on the reports during "due diligence" but she would have options if we have any issues.
Now all through this the other couple of agents kept calling and tried to get the listing promising Higher prices from their buyers and all kinds of unrealistic claims. It did make the Administrator think but because we prepared them they stay with us. Understand we don't take listing we do offers and double end sales. Listings come later if we can't do the investor deals.
Now to complicate matters the Administrator went out without our knowledge and purchased a home all cash in Nevada so now I had their agent calling me lol. This happens often and what the Administrator forgot was that even though the estate property closes which we are handling they can't touch the funds until final distribution so all net proceeds go into an estate bank account until final distribution (4-6 months later).
So too make a long story short. Because I know the process I arranged for my hard money lender to give them a loan based on the value of the house and I freed up $230K for them to buy the Nevada home and we had a hard money lender in Nevada give them the balance so they were able to pay all cash. These loans would be paid off as follows: The $230K they borrowed from the San Leandro house would be their down payment in Nevada and paid off when we resell and close the estate home. The $100K loan balance in Nevada would be paid off in 4 months once the Final Distribution (end of probate) was complete and they would end up with a free and clear retirement home in Nevada. This was the end result and the Administrator and her husband could not be any more happy I handled all this with my team and got the job done.
Now along with this I had an estate attorney who was trying to blow our deal so his agent could buy or sell to his investor. This was tough as the attorney fought me on the sale and on pulling money for the Administrator to use. I prevailed because I knew the laws and this attorney had no control because the Administrator realized we were working for them and the estate attorney wasn't.
Now to add to this, the estate attorneys agent tried to offer again once he was told by the estate attorney my original offer was falling out. The other agent who was trying to bring an offer who stated $500K because he knows me and this was his only way to compete was also toast.
What we then did is listed the home on the MLS to we could expose for more money and I contacted both these agents and said the offer date is 11/15/15, bring me these offers you told the Administrator you have. They both failed to do so even though they could have had a pre-empted offer. So both blowing smoke like many do. They both failed to perform and the Administrator was very happy they didn't listen to the hype and BS Artists running around.
Bottom line my Client (Administrator) received $400K, All Cash Net, As Is from our Landlord buyer and paid off the $230K loan in Nevada and now with $164K sitting in the estate bank account and less than $15K in attorney and creditor costs they are pulling out $100K to pay off the loan in Nevada without having to wait until Final Distribution and will be sitting Free and Clear in their dream home in Nevada. Yes they paid some costs ($10K) for the two loans (Free Money to them) but it was worth it for them because they did not want to lose this home in Nevada.
Understanding the probate laws and procedure and how to consult and assist the Administrator earned us $24,500 plus a $2600 loan fee which I ended up crediting back the loan fee to offset their moving costs. Do you think we have a client who will use or refer anyone else?
I love Probate Real Estate! Not just for the earning BUT because of this Happy Face at closing, the Hug she gave me and Thank You (Letter) after Thank You and even a $100 Outback Restaurant Gift Certificate for my Wife and I.
NOTE: I will be changing up the DF Probate Course come 2016 as I move into One On One Probate Agent or Investor Coaching. This will be a weekly , 1 hour One On One phone session over 3 months. I will dial YOU into to your area probate court system and work with you from A to Z so you can start adding what I do to your business. Only a Max of 9 Students will be taken for this One On One program which runs from Jan to the end of March. Contact me now for details so you can reserve your spot and Jump Start your 2016
EMAIL US: GARYDMRPROBATE@GMAIL.COM FOR THIS FREE 5 WAYS WE EARN REPORT FOR AGENTS TO LEARN HOW TO REPRESENT INVESTORS AND RETAIL BUYERS AND FOR INVESTORS TO FIND MORE WHOLESALE OPPS WITH PROBATE HOMES.....
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