Can I Get Out Of A Real Estate Deal?
If you’re a real estate investor and you find yourself in a deal that you just don’t desire to stick with, you may wonder if there is a way you can get out of it. First, before I answer that question, I do want to go over a couple rules that I am adamant about.
The first rule is don’t make promises you can’t keep. If you don’t think you can do something, don’t promise you can. I understand sometimes you just can’t follow through for one reason or another, but that should be the exception. If you promise something, do what you can to follow through with it.
The second rule is don’t jeopardize your credit. What I mean by this is if you’re purchasing a home as an investment, you can go about this using my Niche2Wealth strategy. When you do this, you’re not using your credit to obtain a mortgage loan from the bank. Rather, you’re buying the home ‘Subject-To’ the existing loan. This saves you from tarnishing your credit in case the deal goes south.
How Can You Get Out of a Real Estate Deal?
Maybe you found out the house has a lien or some other major issue occurs. There are several things you can do in this case.
First, if you’ve not promised to make payments on their loan, you’re not obligated to go through with this. If they’ve given you the deed to the house, but it hasn’t been recorded, you can give that deed back to the owner. Of course, you’ll want to converse in a friendly manner with the seller, honest and professional. As you know, your
reputation matters, so you want to be tactful and walk-in integrity when you’re dealing with a situation like this.
What If You’ve Promised Something?
If you have made promises to the seller and you still want out of the deal, you can still sit down and have a heartfelt conversation explaining what’s going on. Let them know that you’re not out to stiff them in any way, but you’ve got this situation going on and need to let the deal fall through. Be honest and again, walk in integrity.
Use My Purchase Agreement
Make sure you use the purchase agreement that I offer my students, as there are contingencies in there that you can use as an opportunity to release you from the real estate deal. This is probably the safest way out of the deal.
If you’re using your own contract, be sure your lawyer looks at it to make sure you’ve got something in there that you can use to opt-out of the deal should you find yourself needing out.
As I said before, you don’t want to go around making promises and signing contracts without really putting the time in making sure this is something you really want to pursue. Still, I understand if something happens that you didn’t foresee and want to get out, so be sure you’re using an agreement that gives you some leeway.