The Titanium Vault hosted by RJ Bates III

Buyer Vs Title Company | Learn From My Wholesaling Mistake!

• RJ Bates III • Episode 602

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If you’re new to my channel my name is RJ Bates III. Myself and my partner Cassi DeHaas are the founders of Titanium Investments.

We are nationwide virtual wholesalers and on this channel we share EVERYTHING that we do inside our business. So if you’re looking to close more deals - at higher assignments - anywhere in the country… You’re in the right place.

Who is Titanium Investments and What Have We Accomplished?

Over 10 years in the real estate investing business
Closed deals in all 50 states
​Owned rentals in 12 states
​Flipped houses in 11 states
​Closed on over 2,000 properties
​125 contracts in 50 days (all live on YouTube)
​Back to back Closers Olympics Champion
Trained thousands of wholesalers to close more deals

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Speaker 1:

Welcome back to oh that's fucking adorable the series where I talk about how things go wrong and literally make me respond with that phrase right there, so you guys can learn from it and not repeat the exact same scenarios in your own wholesaling business. Today we're going to be talking about well, it's a deal that you guys already know about, because we just released a video about a week and a half ago saying how I was going to make $50,000 in 13 minutes and I broke down the story about how a future TU member brought us the deal and then I knew exactly who to call on. Danny called the other TU member and we were able to get the deal done and it was going to be a $50,000 assignment in 13 minutes. Now what I will say because this is the oh that's fucking adorable series normally it's about how deals fall apart. The deal did not fall apart, but it still had one of those situations that came about right at the closing table that almost became a deal killer. But we found a solution and obviously, as it was happening, I kind of just chuckled and said, right, when I thought I made a video, a YouTube video, about every last little scenario that I thought could happen in a wholesale transaction. Bam, something that's never happened to me before happens on a deal, so let's break it down.

Speaker 1:

The future to you member calls Garrett Littleton on my team, says hey, I've got a deal, so let's break it down. The future TU member calls Garrett Littleton on my team, says hey, I've got a deal. It's a listing agreement. Seller doesn't want me to sell or list the property on Zillow, realtorcom or the MLS, but wants me to sell it for them. I take a look at it. I'm like, hey, this seems like a great deal. It's here in Texas. Reach out to Danny. Danny calls the TU member. Tu member says I'll take it. Boom, we sign the contract. We use a TREC contract. Future TU member who's the realtor says what title company do you want to use? So I go with one of the many title companies that we use here in Texas For the sake of that title company. I'm going to leave it undisclosed. There's no reason for me to bring that up in this video. So I'm going to leave it undisclosed. But I choose the title company that I want to use. Everything is great.

Speaker 1:

We sent off JV agreements. We sent off assignments Earnest. We sent off assignments Earnest. Money gets deposited by us. Earnest money gets deposited by the buyer. They do their inspection. They're happy with it.

Speaker 1:

Now the seller in this deal is an elderly gentleman and one of the points of contention on this deal was he needed a 45-day lease back. The buyer was willing to give that because we gave a $5,000 concession for the interest that they would be accruing over that 45 days. So buyer's okay with this. However, the seller is an elderly gentleman. He wants the money up front and anytime delays start coming about or extensions or it just feels like it's going to be too good to be true for this seller, it could kill a deal. It could spook that seller and say, never mind, I just want to go do it the traditional route. And so that's what kind of comes about during this transaction On our side.

Speaker 1:

The TU member that was going to buy it from us comes back and says I'm actually going to be bringing on a private money lender on this. He's going to be the buyer, so we need to do a name change addendum and then they're going to work out their payment arrangements on the backside, and all that which I was completely okay with, complete transparency. This is a unique deal where it doesn't really fit the normal wholesale transaction, where it's like lead generation, the acquisitions, the then recon, the dispo it all happened so rapidly where it was like there wasn't really no communication with the seller. We're going through a realtor but it's not on the MLS, no recon whatsoever, no dispositions, just one phone call and it's closed. So certain expectations are there where there's going to be amendments and some conversations about making sure how we're going to get this deal across the finish line.

Speaker 1:

However, this buyer that comes on, the private money lender who is now the official buyer on the transaction, he causes an issue the day before closing. And this is where the oh, that's fucking adorable comes in, because the seller is like hey, when am I going to be receiving my money tomorrow? The seller is like, hey, when am I going to be receiving my money tomorrow? How am I closing? When is the buyer closing? And if you've ever done a deal with an elderly seller, you kind of know what I'm talking about. Right, it's the nervousness that's there. I'm just wanting to make sure that this is really going to happen, because that 45 days he's really wanting to take to move to his new property and so at this point he's kind of starting to feel the nerves of I'm actually about to have to pack up my life, move to another property, I'm actually going to be selling this house, I'm going to have all this money, like the reality is setting in. But he's just verifying and simultaneous to the seller wanting to know this, which, mind you, the seller's going to his realtor, future TU student, who's then communicating through us and the title company.

Speaker 1:

So there's a lot of points of communication. The buyer comes to us and says I did a Google search of the title company's address and I see that they have a rented space. They don't have their own brick and mortar location. They've rented the location and because of that I refuse to close with that title company. Now, in all of the transactions that I've ever done, I've never had a buyer refuse to close with a title company purely based on what their office looked like or the fact that they were renting it.

Speaker 1:

Now, the initial communication about the refusal was to the title company itself. So kudos to the title company. They tried to solve this issue up front before we ever got involved. The escrow officer got on the phone with the buyer. The attorney for the title company got on the phone. They sent over their escrow license, right, the bar number for the attorney, proof that, like, hey, we are a legitimate title company. We've been doing this for a while. There should be no concerns.

Speaker 1:

Now, when it came to like when the communication finally got to me, I was like, hold on. I could actually look this up pretty easily because I remember the first deal that I ever closed with this escrow officer. I actually went to her office and I remember taking a picture in the office and posting it on Facebook. So I went into my Facebook profile and looked it up and saw that January 29th 2018 was the first time that I ever closed the deal with this escrow officer. And so I'm like, hey, maybe if we show how many deals and how long we've been working with this escrow officer, this will, like, calm the nerves of this buyer. Well, it did. He did not care about any of the credibility, any of the proof, he was 100% refusing and was willing to walk away from this deal if we did not change title companies.

Speaker 1:

Now, again, I have to give a ton of credit to the escrow officer and this title company because, despite the fact that, essentially, their entire career and their business was being brought into question here and their credibility was being questioned. They did not argue, they did not get emotional about it. They just kept trying to bring more credibility and solutions to the table, which is exactly what you want for people that you do business with. And so what ended up coming about from this is that escrow officer actually reached out to another title company that she has connections with and said what if the buyer were to wire the funds to you and then you were to wire the funds to me? Maybe that would make the buyer feel better? Now, for the life of me, I don't know why that made the buyer feel more comfortable, but it did, and because of that, the deal actually just closed, and now funds are being dispersed, which is a beautiful thing, because the elderly seller's property got taken care of the future TU member. She got taken care of. Our other current TU member his buyer got the deal and we got taken care of as well.

Speaker 1:

But the lesson to be learned here in this transaction is for one just when you think you've experienced everything in a real estate transaction, prepare yourself. There will be something new that comes about that you weren't prepared for. But when that does happen, do not get overly emotional about it or freak out and hit the panic button. I personally believe the reason why this deal was able to still make it to the closing table on time, without having to alarm an elderly seller and really cause a chain of events with a ton of communication needed, is because everybody stayed calm and solution oriented.

Speaker 1:

Specifically the title company that we work with, despite the fact that they were the ones that were called in the question, they were the ones that brought a solution to the table and, of course, a ton of communication with us along the way, and we were trying to figure out a way to solve it as well, but they were the ones that brought that solution and because of that, the deal closed and funded and everyone was taken care of. So stay calm, stay solution oriented. More deals will make it across the finish line. That's our episode of oh, that's fucking adorable. Let me know if you've ever had something like this take place in one of your transactions in the comments. Show me some love Like today's video. We'll see you guys tomorrow.