In 2001, I was a brand new Realtor. The office I worked for had a policy that to work on your own you first had to have a trainer on your first two buyers and first two sellers. That meant that I would make very little money on those first four clients. I was required to give a large portion of my commission to the trainer for this assistance.
I had listed two houses for sale and had sold a house to a buyer. I only needed one more house to get out of the training circle and start making money.
So, I get this phone call from this Plumber. He was looking for a cheap house (no more than $25,000) to buy for his ex-wife and young son. I wasn’t ral excited about the price but I was determined to get out of the training circle.
I take them to go look at the houses that met the area and price range. The houses we looked at were falling apart. Some had been trashed. Some had water damage. Some had particle board floors. Somehow despite all this they find a house that will work. The house is a living are/kitchen combo, a small bedroom, and a bathroom. It had about 300 sq ft in the whole house.
I write up the contract and it gets accepted. The house is under contract for $22,000 ($3,000 less than the list price). The plumber tries to get a small loan on it. An appraiser goes out and won’t approve the value for the loan. The appraiser said the house wasn’t worth $22,000!
To top it all off the seller wouldn’t lower his price to meet the appraised amount. The Plumber refused to pay cash for the difference between the appraised amount and the contract amount. So the loan fell through and the ex-wife and son wound up without a house!
And yes, I still wound up in the training circle just a little longer than I had hoped.
In conclusion, just because it looks like a cheap house doesn’t mean it is CHEAP enough!
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