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Private sale

Kathy 3600

New Forum Member
REIN Member
Joined
Apr 30, 2015
Messages
3
We have an acquaintance who approached us about purchasing her rental property. It meets all the rein requirements and cash flows. Is there anything specific we should be aware of with a private purchase? Have always bought through a real estate agent
 
R

RussellWestcott

Guest
Guest
Great work and congratulations, sounds like you are off to the races. The system is the same if you are buying the property privately or not. Dust off your ACRE manual, and dive headfirst into the due diligence and offer writing tabs, that is where you will find much of the details to help you.

Couple of tips I can give you:
- Never give deposits to the seller, always have the deposit go to your lawyers trust account.
- This next tip may sound like a contradiction to the the whole process of 'private sale'... If I were you I would seriously consider 'hiring' a Realtor to help you out with this transaction... EVERY property I have ever bought (even the ones through private sellers) have gone through a Realtor.
They are experts at what they do, and have written/ negotiated/ closed/ arranged inspections on hundreds of properties... and know what they are doing. I have many times paid for, out of my own funds, for my Realtor's time to help close the deal. If you are not sure what this would cost, ask your Realtor if you bring them a private sale and would they be interested in helping you write the offer and close on the the property for a $/hour basis... or how much would this service cost.

My personal realtor whom I have now been using for more than 12 years, would do this service for me for free (as I have bought and sold many houses through him)... but I pay him anywhere from $500 - $1,500+, depending on how much work is involved on his part.

Hope this help, and best of luck!
 

Alvaro Sanchez

Ottawa-Gatineau Investor
Registered
Joined
Jun 5, 2009
Messages
966
Once you agreed in principal on a price for the property with the seller, you might want to ask your lawyer/notary to write up the offer to purchase with proper terms and conditions (financing, inspection, terms, etc) then ask seller to meet with lawyer for signing. The lawyer will ask seller to bring some documents on the property (survey, taxes, mortgage, leases, etc) prior to the meeting to speed up the process for closing and such.

I have bought several properties private and that is exactly my process. In my experience when doing private deals, I do not get a realtor involved as there is no need for it, I use a lawyer or a notary for writing my offers.
 

neill

Airdrie, AB
REIN Member
Joined
Oct 22, 2007
Messages
472
+1 to what Russell said. We used a realtor for our initial private purchases until we got familiar with the process.

On private offers, both buying and selling, I would recommend using the MLS contracts (not sure what province that you are in - in Alberta they are called AREA contracts, for AB real estate association) for a couple reasons:
1) They have been vetted by multiple lawyers
2) They are fair to both buyer and seller - they cannot have any bias towards either party given the origin of the transaction that they were written for
3) They will cover off details that you might miss - and you can cross out and initial, or write into the terms area that all references to brokerages are not applicable.
4) In this case, you know the other party, so some trust is implied already. In the case of dealing with strangers, the doc will help instill confidence - for the above reasons.

I highly recommend that if you are going to do it on your own that you read and become familiar front to back with the doc. Pull old copies from previous deals to use as templates.

Finally, you can write: "subject to buyer's lawyer's review and approval", which essentially provides you with a "get out of jail free" card - you can kill the deal for any reason prior to waiving this condition.
 
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