What Questions Should You Ask a Potential Land Investor When Considering Selling Your Vacant Land?

What Questions Should you ask a Potential Land Investor when Considering Selling Your Vacant Land?
Hi, I’m Beth with TB Properties Buys Land. If you’ve got rural vacant land that you’d like to sell, and you’re considering working with a real estate investor, but you’re not sure yet, what are some questions that you should ask that real estate investor before working with them? The first question that I would recommend that you ask is how exactly are you going to get paid? And that would be a multi-part part question. One, what form of payment are you going to receive, and two, what is the process in which you’re going to receive that payment? For the first part of the question, you want to know: are you going to get a personal check from this land investor? Are they going to wire you funds into your account? And when’s that going to happen?

Will you be paid through a title? Will there be a notary arriving at your door, and once you sign your paperwork, they’re going to hand you a check? And again, what form of payment is that check going to be in? Is it a certified bank check or a personal check? Okay. These are some of the big questions that I would ask regarding the form of payment. Now what about the process? Now I’ve seen some investors where they do a self close. That self close, sometimes they’ll send you the paperwork, they ask that you sign the deed in front of your notary, and then they’re going to promise to mail you a check afterwards. Do you trust that person? Do you have recommendations, referrals? Do you know them personally?

Once you sign that deed and you put that in the mail, that property is theirs, regardless of whether you’ve been paid or not, so that’s something to think about. Will this be a self closed with a notary, a mobile close? Are they going to have a notary show up at your door and notarize the deed that you signed and then hand you a check, and is that going to be a personal check or certified funds, a bank check, okay? Can you check on that notary? Can you look them up and make sure that they’re legit and registered? The self-close is the cheapest way to close, and the most expensive way, but also the safest way, to close is going to be through a title company. A Title company is going to charge you for what they do, but they’re going to be able to offer title insurance.

They’re going to be able to pull all the paperwork and show all the red flags regarding the chain of title, and they’re going to provide that paperwork to you and to the buyer. And once you sign that in front of the notary, they’re going to record that with the County. You’re going to know that everything’s been done correctly, and you’re going to be paid from the title company. So the buyers will pay the title company with certified funds. It’s going to be a bank check, or a wire transfer, and once they have funds cleared, they will pay you as the seller. That’s the safest form, but it’s also the most expensive form of closing. That leads us to question number two. You need to ask them who is going to pay for closing? Who pays for closing costs?

Some will pay for all the closing costs, some will split those, and you need to find out if it’s going to be split, what does that look like? Is that going to be deducted from the offer that you’ve been made? Now, if you look at your purchase agreement, and on that purchase agreement it does not call out who’s paying for closing costs, know that the title company is going to assume you’re splitting closing costs. As the seller, most of the time you’re going to pay for title insurance. They’re going to split the escrow fees, and then someone’s going to pay for the recording costs, and then you’re going to pay for any transfer taxes. So if you’ve not agreed, if you’re not seeing that on the purchase agreement that they are paying for all closing costs, know that the assumption is it’s split.

Another question that I would ask is how fast are you going to be able to close? And whatever answer they give you, maybe they give you two to three weeks. Maybe they give you 30 days, maybe they tell you 60 days. Ask them also, how do you plan to pay the title company, or how do you plan to pay? Are you paying in cash, or are you going to be seeking funding. Maybe they’re getting a loan from a bank, or a private lender. Understand that if they’re looking for funding, that that closing date is subject to them receiving funding. With this said, if the appraiser’s running late and the appraisal is needed in order for the bank or the lender to provide funding, that’s going to push the closing date back.

Maybe they promise you 30 days, but understand if they’re getting funding from a lender that the likely scenario is it’s going to close longer, like 60 days or even 90 days. These are questions to ask, because if you’re selling your property through a land investor, it may be your first time working with them. You may not know what questions to ask, but these are questions that I would certainly ask, and there’s probably more that we can get into at a later time. If you’re working with TB Properties Buys Land, the answer to these questions is one, we’re going to pay you through a title company. We always close to a title company because it’s the safest, most trustworthy way to close.

We are going to send our cash to the title company, And they’re going to pay you at the end of the transaction. And they’re going to ask you, do you want a bank wire, or do you want a check for them to send to you. And we, TB Properties Buys Land are going to cover all the closing costs. So whatever we offer you on that purchase agreement, you’re going to receive. That’s what you’re going to receive from the title company, and that’s spelled out very easily that we are paying for everything. The only thing it says regarding the seller’s closing cost responsibility, is that you, as the seller, are paying for are any liens against your property. If you have any liens against your property, we’re expecting you to pay for those.

We understand that you probably don’t have those. And third, how fast will this close? This will depend on the title company. We are prepared to close as fast as two to three weeks if the title company can keep up because we are paying with cash. I hope this helps give you some confidence with responding to a potential land investor. If you have any other questions about working with a real estate investor, or about working with TB Properties Buys Land, please reach out to us. You can give us a call on the phone at 214-699-4455, shoot us an email or reach out across our website at www.tbpropertiesbuysland.com. We look forward to working with you and hearing from you soon. Thanks.

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