Ok, so it hasn’t been a complete nightmare. I may have just been grabbing for your attention, but it has been anything but a smooth ride so far. We have gone through three buyers, had two delays, and done an extra $3000 in repairs that we didn’t think were going to need to be done when we listed it on the market.
Maybe you will be able to relate to some of these circumstances from when you tried to sell your house.
How to sell your house
I knew that this house was going to get a lot of attention, and get exactly what I was asking for it, if not more. I had owned this house for three years at this point, with two different renter in it. Both times I listed it for rent I got so many hits on it that I was able to pick who I thought would be the best candidate.
The home was in a secluded area, was totally updated and had 7 acres of land on the outskirts of OKC. This was the perfect home for anyone that wanted to be able to enjoy city life, without being right in the middle of the city. In fact, this was the home that my wife (gf at the time) and I originally wanted to move into, if you’re following along.
I got with my real estate agent and came up with a plan for marketing it and listing it at a price that we thought would gain the attention that we wanted to get it sold quick, fast, and in a hurry.
There were some maintenance issues that needed to be done before getting it on the market, some cleaning, and some landscaping to make it look really pretty.
My realtor was going to flash it out to all of her contacts to start getting some buzz around it and after we got the necessities hashed out it would hit the market on a Friday.
Within a week of the home actually hitting the MLS we had multiple offers on it, even one that was a few thousand above asking price. Like I said, it was a desirable home, at a desirable price.
We had an offer that was over asking price, but was asking for us to pay their closing costs, as well as some concessions at closing. Another offer was at asking price, and was asking to leave the fridge, washer, and dryer. The last was just under asking price.
We ended up accepting the middle offer (we were going to leave the appliances anyway!). We didn’t know how big of a mistake this was.
Everything on paper looked great with our first buyer. They were offering what we had asked, weren’t asking for anything except the appliances that we wanted to leave anyway, and could close in 30 days.
Little did we know how financially irresponsible they would turn out to be. As with most home buyers, they were required to submit a pre-approval letter with their offer. Now, this doesn’t mean that they were approved for a loan yet, it just means that the bank did a quick look at them and said “Yeah, we can probably give these people money to buy a house.”
Here’s where the irresponsible part comes in. After they got the pre-approval letter and got their offer accepted on the house, they thought “Hey, we’re getting a new house, why not get a new car too?”
For any of you that didn’t cringe after you heard that, you aren’t paying attention. A couple of weeks after accepting their offer we get a notice from the bank that they aren’t going to be able to loan the money because the new car loan has put them past the acceptable debt to income threshold.
Crap! Oh well though, nothing you can do, time to list it again.
After we heard the news about this, we went back to the people who had previously made an offer and asked if they would be interested in resubmitting, as well as putting it back on the market. The next day we were back in contract for asking price again. Yay!
This time things went a little different. The buyers did their inspection, as they should, and then came back wanting some things fixed that we didn’t anticipate. It was right around this time that we found out that the house had termites and needed to be treated.
This is not really that big of a deal. When you are selling a house, it is almost assumed that the buyer is going to want some things repaired, so we went through their list of about ten items and agreed to knock off seven of them and get the house sold.
Things went swimmingly from here, until about a week before we were set to close.
Punch to the gut
The title company tells us that they cannot issue insurance on the title due to an easement issue. The house was apparently built about five feet too close to the road. In the case of a disaster that destroyed the house, it would be a little bit more difficult to rebuild as you would have to go through the county for the easement.
Normally, this wouldn’t be that big of a deal. Most people are not going to give up an amazing house for some far off thing that almost certainly will not happen.
Not buyer number two though. These people had a friend, who at some point had an easement issue and a house that burned down. It apparently took them months to get the house rebuilt because of this issue.
If you are following along, we are about to move on to buyer number three. A day after hearing about buyer number two’s friend with the easement issue we were signing paperwork letting them out of the deal with their earnest money.
They say that third time is the charm. Well……….. in our case, not so much. Ok, we did get back into contract just two days after letting buyer number two out of the deal. And, we did get over asking price from buyer number three. And, they didn’t want any additional repairs or concessions given to them.
However, three days before we are supposed to close we find out that the buyer is starting a new government job. He was supposed to start on monday, four days before closing, and get the bank a letter of employment verification so they can issue the loan and close on the house. But……
The Friday prior he had found out that they didn’t want him to start until the next Monday. Four days after we were supposed to close!
Yup, you know what that means, pushing the closing out another whole week.
The Big picture
In the grand scheme of things, none of these things are really that big of a deal and shouldn’t really hurt us in the long run. We are actually set to walk away with more than we would have from either of the first two buyers, just two months later than we though we were going to.
We have learned some lessons about what could go wrong when you go to sell your house, and some things about ourselves. Mainly patience.
When it comes time to sell your home, prepare yourself for as many worst case scenarios as you can. Then when some, or all, of those happen, you aren’t stressed out about them.
These set backs are only minor in our long journey of real estate investing. Hey, we are The Expert Home Buyers! Nothing is going to stop us from succeeding and building a long lasting real estate investment company that can weather any and all storms.
We are going to keep pushing forward and documenting our progress for you along the way so you can learn from our mistakes, and our successes!