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How A Great Deal Can Go Bad
   by Chuck and Sue DeFiore   

  This started out as a wonderful Lease Purchase. It was a 3 bd 2 ba, 1500 sq. foot home with a very large backyard with pool and spa. We had left a message for the owner about lease purchasing and he called back. We went over the property particulars and how we work and set up a time to meet. The owner was one month behind in his payments. He showed us the paperwork. We told him we could get him his back payment, plus some, in addition to positive cash flow. He signed the contract. His main concern was getting his payments covered.

  He was minister for his church. He also had it listed with a friend. He said he could cancel the listing. We told him to do so immediately.

  We ran an ad the following week on a daily basis. We were inundated with calls. Anything in Las Vegas with a pool and spa under $1000, in a nice area (which this was) will get you a ton of calls.

  We set up times for multiple people to see the property. This particular Saturday 4 couples showed up. Two stayed. One was minister and his wife, the other a couple that were living with a brother right around the corner. The minister and his wife needed a couple of days to get their money. The other couple had the funds ready. We told them to both fill out an application, and that would determine who got the property. Well, we guess the minister didn't like that. He left. He then proceeded to call the agent (the sign was still up) Note: If the sign is up, have the owner take it down.

  This is where things started to fall apart. The owner apparently called the agent and told her to cancel the contract, however, it was not done. (We had asked the owner on 3 separate occasions during that 2 week period, when the sign was coming down). In any case, the minister and his wife called the agent, the agent said it wasn't canceled and that the owner was 2 months behind, and many other derogatory things about the owner. The other couple, also called the Realtor, rather than us. We had given them a card and flyer with our name and number on it, but they called the listing agent anyway. Well apparently the agent gave them the same story, only yes, she admitted the owner did call her to cancel. Well, our own check found that the owner lied to us and forged his paperwork. This is why we also do an independent check on an owners mortgage payments.

  At this time another couple that had looked at the property the first week called back and wanted the property. We told them the situation and that we did have another property for them.

  Well, we did not move this property for obvious reasons. However we had 3-4 weeks with a lot of showing time in this property, along with a lot of aggravation and back and forth phone calls. The owner was well aware of the clause in our contract. The agent was telling the owner he had to work through her or she could take his house away. Obviously, she couldn't, but she had the owner convinced she could.

  We politely reminded the owner of our contract and our clause. He ignored it. We then filled in small claims court and also reported the agent.

  Remember, while Lease Purchasing is a great business, there are going to be deals like this. You just have to decide how you want to handle them.

  So be sure to check out payments on a seller and always have the Real Estate sign taken down.

  (Note: As mentioned in our manual you can work with sellers that have the house listed. In the case you are working with a seller who wants to keep the listing and have you work it, it is a different story. The owner is very cognizant of the clause in the contract, and many times has paid us a deposit up front).

Copyright DeFiore Enterprises 2000

Interested in having your own successful, home based creative real estate investing business? Chuck and Sue have been helping folks start successful home based businesses for over 17 years, and we can help you too! To see how, visit www.homebusinesssolutions.com for the latest FREE tips and tricks, educational products and coaching in creative real estate investing and home based businesses.
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