Removing Deed Restrictions Requires Reading

My wife teases me all the time about my distain for reading instructions. It just seems natural that men should be able to figure out how to make things work without having to read a small folded paper to guide them. Real men should be able to take things apart and put them back together without reading any micro-sized instruction pamphlet. Some of the best instructions are just one page of pictures! That’s how it should be and I hate to admit it, but in the real world it is sometimes better to read.

An example where reading can be cost effective is reading contracts for removing deed restrictions when buying real estate property. This is especially true where large institutions are the sellers. A case in point is when lenders are selling their REOs or approving short sales and at the last minute, sometimes at closing, the institution decides to slip in an agreement for the investor to sign. Usually it’s at the last minute because they want to trip up the investor with a deed restriction or other contract limitation and usually it’s the closing agent who discovers the issue – since, of course, real men don’t read.

A few years ago I looked into removing deed restrictions as a system and developed a Course called “Deed Restrictions Be Gone” which gave eight (8) ways to overcome the onerous and wasteful deed restrictions lenders decided to impose on investors. Sales were pretty good but as I looked closely at who purchased the course, it was mostly law firms and national lenders. It was actually funny to watch these same lenders develop new contract language to overcome my suggested tactics. I guess the guys had their secretaries read the materials because real men don’t read.

I love to write but I hate to read. I blame this on my male genes, because real men don’t read. But I slipped up today and accidentally read an addendum from Freddie Mac. In their Addendum they stipulated that the buyer (investor) agreed to pay the seller (Freddie Mac) “Liquidated Damages” of $10,000. What this means is that if your Earnest Money Deposit (EMD) was $1,000 on a specific property and you defaulted and didn’t close, your liability was not $1,000 but rather $10,000 plus the $1,000!

When investors ask me what risk they have in a deal I explain that most contracts limit the liability to the amount of EMD. As you can see this isn’t always the case – I know that because I accidentally read it. It is very important that every investor READ whatever he or she will be signing BEFORE they sign it. If it says one thing and the opposing party (seller or buyer) tells you it won’t happen and to just sign it, it likely will happen and you’ll have no recourse.

This Must Read Policy is especially true when you are dealing with an experienced investor who is selling you a property or buying one from you. A simple sentence in the Addenda Section added by this opposing investor can make your life miserable, cost a lot of money or often lose the deal for you. For example, a buyer wants to use his closing agent and you notice he wrote in a clause allowing his closing agent to extend the closing up to ninety (90) days to provide clear and marketable title.

Often times your buyer will delay the closing for numerous reasons knowing that you have to close by a certain date. At some point your original seller will no longer give you an extension and you have to default on your contract and lose you EMD. You are thinking you’ll get your buyer’s EMD but that doesn’t happen. What does happen is your buyer contacts your seller and simply says he is the real buyer and is ready to close and takes your deal.

change your life mentoring click button j 300x236 1So here is what I suggest- turn your computer monitor away so no one can see what’s on your screen, go into a vacant room where no one will bother you and READ every contract and especially the contract clauses and addendum’s for removing deed restrictions for example. Do not let anyone know what you are doing but make sure you confront your opposing party about contract terms you don’t like. If you have to, read the contracts at home at night under the covers with a flashlight (preferably an LED) with the sheets pulled up because real men don’t read.

To your limitless success,

Dave Dinkel
Real Estate Mentoring Program Founder

Visit davedinkel.com for full privacy policy, terms of use, etc.  Be sure to contact us through the website at davedinkel.com if you have questions or concerns ([email protected]).  Results mentioned in this presentation and any video, article, and/or material related to Dave Dinkel and his associated businesses are not typical nor are a guarantee of any earning potential.  No advice is to be construed as legal, accounting, or professional advice EVER.  Please consult related licensed and qualified professionals before taking any action.  No person(s) mentioned in the articles and /or shown on videos received compensation in any form for their opinions.

Removing Deed Restrictions Requires Reading

My wife teases me all the time about my distain for reading instructions. It just seems natural that men should be able to figure out how to make things work without having to read a small folded paper to guide them. Real men should be able to take things apart and put them back together without reading any micro-sized instruction pamphlet. Some of the best instructions are just one page of pictures! That’s how it should be and I hate to admit it, but in the real world it is sometimes better to read.

An example where reading can be cost effective is reading contracts for removing deed restrictions when buying real estate property. This is especially true where large institutions are the sellers. A case in point is when lenders are selling their REOs or approving short sales and at the last minute, sometimes at closing, the institution decides to slip in an agreement for the investor to sign. Usually it’s at the last minute because they want to trip up the investor with a deed restriction or other contract limitation and usually it’s the closing agent who discovers the issue – since, of course, real men don’t read.

A few years ago I looked into removing deed restrictions as a system and developed a Course called “Deed Restrictions Be Gone” which gave eight (8) ways to overcome the onerous and wasteful deed restrictions lenders decided to impose on investors. Sales were pretty good but as I looked closely at who purchased the course, it was mostly law firms and national lenders. It was actually funny to watch these same lenders develop new contract language to overcome my suggested tactics. I guess the guys had their secretaries read the materials because real men don’t read.

I love to write but I hate to read. I blame this on my male genes, because real men don’t read. But I slipped up today and accidentally read an addendum from Freddie Mac. In their Addendum they stipulated that the buyer (investor) agreed to pay the seller (Freddie Mac) “Liquidated Damages” of $10,000. What this means is that if your Earnest Money Deposit (EMD) was $1,000 on a specific property and you defaulted and didn’t close, your liability was not $1,000 but rather $10,000 plus the $1,000!

When investors ask me what risk they have in a deal I explain that most contracts limit the liability to the amount of EMD. As you can see this isn’t always the case – I know that because I accidentally read it. It is very important that every investor READ whatever he or she will be signing BEFORE they sign it. If it says one thing and the opposing party (seller or buyer) tells you it won’t happen and to just sign it, it likely will happen and you’ll have no recourse.

This Must Read Policy is especially true when you are dealing with an experienced investor who is selling you a property or buying one from you. A simple sentence in the Addenda Section added by this opposing investor can make your life miserable, cost a lot of money or often lose the deal for you. For example, a buyer wants to use his closing agent and you notice he wrote in a clause allowing his closing agent to extend the closing up to ninety (90) days to provide clear and marketable title.

Often times your buyer will delay the closing for numerous reasons knowing that you have to close by a certain date. At some point your original seller will no longer give you an extension and you have to default on your contract and lose you EMD. You are thinking you’ll get your buyer’s EMD but that doesn’t happen. What does happen is your buyer contacts your seller and simply says he is the real buyer and is ready to close and takes your deal.

change your life mentoring click button j 300x236 1So here is what I suggest- turn your computer monitor away so no one can see what’s on your screen, go into a vacant room where no one will bother you and READ every contract and especially the contract clauses and addendum’s for removing deed restrictions for example. Do not let anyone know what you are doing but make sure you confront your opposing party about contract terms you don’t like. If you have to, read the contracts at home at night under the covers with a flashlight (preferably an LED) with the sheets pulled up because real men don’t read.

To your limitless success,

Dave Dinkel
Real Estate Mentoring Program Founder

Frequently Asked Questions

1. What Should I Do If a Seller Ghosts Me?

If you feel you have been ghosted, act decisively and quickly. If you have tried texting and calling, it’s time to drive by the seller’s location. I always take the recorded Notice of Interest or Memorandum of Contract to leave, so the seller knows it exists. Go by at a time when you know they will be there and don’t be confrontational, just get the facts.

In our experience with new investors, the chances of losing a deal with no contract is likely over 85%. Verbal commitments do not apply in contract law; get everything in writing, especially contract changes.

Different ‘gurus’ have different opinions, but our experience is finding motivated sellers and then a buyer for your deal. Ideally, you should be finding motivated buyers from day one, so you are ready when you find a seller. Buyers are easier to find as you can see at https://davedinkel.com/products/

Prevention only comes about by thinking a Black Hat wholesaler will be coming after your deal. First, educate the seller that an unscrupulous investor may come by and illegally offer more money, have the seller sign your “Notice to Homeowner,” stating that he understands he cannot accept another offer.

There is nothing illegal about changing their mind, it is called seller remorse and occurs about 25% of the time. However, if they have signed your contract, it can’t be cancelled for any reason unless acceptable to the investor/buyer.

If price is an objection, you need to find out how important it is to sell fast and for cash. If the seller isn’t under a time constraint, has a money issue, or has a personal dilemma, he may not agree to the price you need. Offer to help move and build it into your price before you make your offer. However, never give the seller money; only pay the moving company, and only after closing (escrow with a closing agent). If fear is the seller’s issue, break it down into what the real problem is and answer their objections one at a time.

You can get to the root of motivation for a seller by asking a few questions. First, “Why are you selling?”, “How soon can you close?”, and Are you ready to sign an AGREEMENT today, if not, what do I have to do to make you comfortable?’. The answers to these questions will determine the truth about your seller’s motivations.

The best times to involve your attorney in your deals are to have him review your contracting, review the signed contracts from the seller and end buyer, have him open escrow and start the title work, negotiate with city or counties for lien reductions or mortgage payoffs with lenders, and to close the transactions.” Your attorney is not the adversary; it’s the opposing party’s attorney who is a deal killer, and having your attorney allows him to help overcome this obstacle.

The key to successful prospecting and bringing back deals that didn’t close is to follow up until the property is transferred in the public record. Some of our deals have been where the seller came back to us months and years later because they felt comfortable with us and not the other “pushy” investors who contacted them.

Your contract’s most important clauses are inspection period (as long as possible), when the EMD must be deposited if at all, your ability to access the property, any added clauses specific to the property that will protect you against seller claims later that were verbal only.

Visit davedinkel.com for full privacy policy, terms of use, etc.  Be sure to contact us through the website at davedinkel.com if you have questions or concerns ([email protected]).  Results mentioned in this presentation and any video, article, and/or material related to Dave Dinkel and his associated businesses are not typical nor are a guarantee of any earning potential.  No advice is to be construed as legal, accounting, or professional advice EVER.  Please consult related licensed and qualified professionals before taking any action.  No person(s) mentioned in the articles and /or shown on videos received compensation in any form for their opinions.