The Paperwork You Need to Close The Deal

This is probably common sense to some, but you would be surprised how many people overlook the paperwork and scramble at last minute to put together the package to take to the client meeting. Now, since this site is for both Real Estate Agents and Real Estate Investors, I will try to separate the two. Although, some of the paperwork is similar.

I like to use either the Yellow Manila Folders, or special Real Estate Manila Folders. The latter is not really required and is probably extra cost you don’t need unless you have a tight ship and need to tighten the ropes even more.

I usually print and prepare multiple packages and have them ready to go. The packages contain the exact same blank paperwork to cover all the common situations I deal with, and couple of extra folders containing few extra uncommon forms that I may need. This prevents me from forgetting any paperwork and having to go through the exact same process of putting a package together.

I also have a Word Document containing the list of Forms I use and when I should use each of them. This document is more of a reference in case I need to print another package in the future, alter the package list, or delegate that work to someone else.

When I schedule a meeting with a seller, I always grab 2 to 3 packages and take them with me along with 3 blue pens. I always take them with me even if I am not sure if I want the deal yet, and I want to get the paperwork signed and done from my first meeting with them because I know they will be more willing to sign in my first meeting with them and I do it as part of my negotiation. The reason I take 2 to 3 packages is to have an extra in case we mess up on any paperwork. I do not want to leave without the signed paperwork. The 3 blue pens also have a purpose. 1 for me, 1 for the husband, and 1 for the wife. I want us all to be ready to sign and not have to pass a pen around. Blue indicates original copy. Not required, but recommended.

Now, lets talk about the paperwork. We’ll start with the common paperwork then cover some of the differences based on investing strategies or agency.

Real Estate Contract (1)
Personally, I like to use my State’s Real Estate Contract used by Real Estate Agents for both my Agency and Investing transactions. This contract has been tested, and has many state lawyers standing behind it. I can always strike out paragraphs, or make changes on the contract. For the investing side, this helps prevent using a language in the contract not enforced by my state. The State’s Real Estate Contracts can be used by anyone not just Real Estate Agents. Keep in mind however, Realtor forms must be used by members of the organization only.

Owner Financing Addendum (1)
This too is a State addendum used for Owner Financing. I use this form to close my subject-2 deals as well. It is less commonly used in Real Estate Agency.

Financing Addendum (1)
This is used in the buying side not the selling side. It is the contract addendum for 3rd party financing. Check your state just in case there is an odd state out there without this form.

Testimonial Forms (2)
This is by far one of the most important forms I carry with me. I always have 2 copies and I always ask for testimonials from both husband and wife. When buying, or selling. When acting as an Agent, or as an Investor. Testimonials are by far the best Marketing tool you will have.

Lead-based Paint Addendum (1)
For older homes

Property Condition (1)
I leave this with them to fill out and come back to pick it up later or at closing if investing

For Short Sales (Pre-foreclosures in general), Owner Financing, Subject-2, Purchase-Options,:

Authorization Form (2)
I always carry two Authorization Forms in case the seller has 2 mortgages (1st and 2nd). This form authorizes me to speak to the lender directly regarding the existing loan to get payoffs, negotiate short sales, or inquire about payments.

Investing Specific:

Disclosure Addendum (1)
This disclosure is written by a lawyer, it is part available to Road 2 Success students in general. This form is intimidating if you read it for the first time. In general, it has the following general topics:
1. I have not given them any legal advice, they can seek one
2. I have not given them any financial advice, they can seek one
3. I am not making any promises regarding the finances
4. I cannot give them time of how long it may take me to pay off their mortgage (sub2/owner financing)
5. I may sell it, rent it, lease option-it
6. Their only recourse is the property and not my company, or me
7. They would refund me all my expenses in case of item 6 (this would probably not hold in court anyway)
8. Other items I do not recall at the moment

They initial next to each paragraph and sign the disclosure. I never had a single seller question the form.

Assignment Addendum (1)
I always have them sign an assignment addendum giving me the option to assign the contract to someone else. Getting their signature on an assignment can be disarming to title companies, and they would understand that I may assign the contract to someone else. I always get this form signed even if I do not plan on assigning the contract. This gives me the option to assign it in case I change my mind.

Real Estate Agency Specific:

Brokerage Service Form (1)
I cannot speak to all states, but I know at least in Texas you must get the disclosure signed

These are the main forms I keep in my package. I do have some other forms, but these are the main forms I carry with me all the time.

• The Power Of Testimonials and How To Get Them!
• Course Review: John “Cash” Locke’s “Subject To, Thats What I Do!”
• The Truth Behind Real Estate Investing

© 2009 Fadi Zeidan's Articles.