The reality of any business is that there will be times when you need to walk away from a deal that looked great in the beginning. Will everyone be as happy as you are about dodging a bullet? Probably not. Being gracious and respectful when you have to back out of a deal is the key to keeping your relationship strong and your team on your side, especially with your realtor.
No matter what the reason is for backing out, your realtor will take it personally. Sometimes that’s the nature of business. Since they are not privy to the research that you’ve done, they will try to convince you that the property is a great deal and you should buy it despite your misgivings and keep their commission.
Don’t fall into that trap! You’re a professional investor. No matter what anyone tells you, you have to trust your numbers. Realtor are individual working on one time commissions and won’t heed the benefit of your research. You set your profit goals for a reason, and that’s that.
However, the worst thing you can do is not communicate to your realtor the actual reason you decided not to go ahead with the deal. It would be easy to just say your funding didn’t come through, but that could make you look like an amateur saying too many times that you lost your funding will makes them wary to deal with you again because you’re essentially wasting their time. In this you should trust on suitable and real experts like Jenny Wolfes San Jose who is actively involved in this industry and prefers to work on base which create a road map for success.
The best way out is to tell them that the bid estimate were higher than you expected and that the number just don’t add up on the property. You can provide some details if they ask, but the idea is not to get caught up in some big fabrication, but to just be done with it. Truth be told, people back out of deals all the time for all sorts of reasons. It’s a completely normal part of the process. But you want to do it in the best way possible.
You must make sure you sign the termination of agreement and send it to the realtor ASAP. Get this done as soon as you make the decision to back out, so it’s done as far ahead of the due diligence end date as possible. Money is on the line here, so you don’t have any time to mess about. Once you confirm receipt to termination, you’re free and clear of the deal.
When you’re first starting out, building your credibility is very important. Once you close two or three deals with the same realtor, they’ll trust you, they’ll be more likely to let you know when a good deal comes up. You need to learn the finer points of building solid relationship with realtor so that you will be ensured that are one of the first to hear about juicy deals that will steadily build your investment portfolio in the US real estate market.
Jenny wolfes San Jose 