Is Holding Cash or Holding Property Safer? (CFFL 559)

Transcript:

Jack Butala:                         Jack and Jill here.

Jill DeWit:                            Hi.

Jack Butala:                         Welcome to the show today. In this episode, Jill and I talk about is holding cash or holding property safer? If you had $300,000 of cash in a bag or a $300,000 house free-and-clear, which one would you want? Before we get into it, let's take a question posted by one of our members on the landinvestors.com online community. It's free.

Jill DeWit:                            Okay. Amy asked, at first I was excited to get a call back of interest for an offer I sent out for a piece of rural vacant land. Unfortunately, the offer was too high for this public housing area and the city located in the county that I targeted. Looking at the standard purchase agreement I sent, that is open for another month, I can't seem to find a way out of honoring the purchase agreement if they sign it.

Here's Amy's stipulations: One. Buyer's confirmation of parcel size.

Jack Butala:                         Done, you're out. You're done.

Jill DeWit:                            Do you want me to keep reading?

Jack Butala:                         No. I do, actually, but here's my point and I don't mean to interrupt you Jill, I'm sorry. Don't worry, Amy, because you confirmed the confirmation of the parcel size is not what you want. Go ahead, Jill.

Jill DeWit:                            Two. Said property is to be sold free-and-clear of all encumbrances with a good and marketable title and with full possession of said property available to buyer at the date of closing.

Jack Butala:                         Number two, in your opinion, the marketable title condition of this property is unsatisfactory and therefore, you can't sign the transaction.

Jill DeWit:                            Three. Confirmation of buyer's acquisition criteria. That's one right there.

Jack Butala:                         I confirmed all the statistics. I went through my due diligence on this property and it doesn't fill my criteria after all. Number four.

Jill DeWit:                            Number four. Seller to provide abstract or prior Owner's Policy, if available.

Jack Butala:                         Okay.

Jill DeWit:                            Five. Seller to retain mineral rights at Seller's request. How do I get out of it or am I on the hook to buy the property?

Jack Butala:                         No.

Jill DeWit:                            Does anyone have any suggestions to add more contingencies to the purchase agreement to cover me better? No, you're fine.

Jack Butala:                         Yeah, you're totally fine.

Jill DeWit:                            I've never even had to do this. You know, what's funny? Here's a reality, Amy. I think you're worrying about it and you don't need to. I've never, ever, ever, ever, and I mean, ever, had a seller come to me and say, "Oh, I went through your list, one, two, three, four, five, and I'm sure you have to buy this." No, they don't.

Jack Butala:                         Sounds like there's a lawyer on the other end.

Jill DeWit:                            No, they're not, and because I can say, "Well, I'm not happy with one and I'm not happy with three." Like three is the bigger one. Here's what I would say. "My acquisition criteria is that this property is affordable and in this range and what I can mark it up and sell it for." I mean, it doesn't meet that.

Obviously, what you just said is, "Look, I sent in an order. It was accidentally too high." That's what you're saying here, Amy. It sounds like I have to do it. No, you don't, because it sounds like you would buy this property at a different price and that's what you'd come back with.

If they say, "You need to buy this property." You might say, and I've done this a lot, Amy, "Look,