In this episode, I want to talk about something I did pretty early on in my business and that I highly recommend you do. A lot of people are squeamish about it, but if it’s done right there really is no cause for concern and it’s a big part of systematizing your business.
I’m talking about giving your realtor the power to sign documents for you. Giving them a limited power of attorney just in order to sign documents for you for the purpose of buying and selling real estate is really important because in most markets right now real estate is such a hot, fast-moving market. There are so many investors that when a good deal is found, especially on the MLS, you want to act fast. You could lose a whole day playing phone tag with your realtor, and miss out on a great deal. You need to give your realtor power to sign, so that they can just call or text you and tell you the numbers on a house, and you can just tell them to bid on it right away for you. You can get an offer in within minutes, as opposed to waiting around hours or even days. I have absolutely lost deals in the past because I wasn’t getting them signed fast enough.
Sometimes you end up in a highest and best situation, where a deal goes up in the morning, the seller’s realtor is flooded with offers, and they tell everyone to just send in their highest and best by a certain deadline. In that case, it doesn’t matter how fast you get an offer in. But, in most cases, the first person in has a leg up. If a seller wants something sold quickly, they will accept the first offer that gets close enough.
For a lot of people, giving your relator limited power of attorney sounds like you’re giving up some control, and it’s true that you have to trust the realtor. If you have been working with someone for a while and they have been recommended by other real estate investors, you might want to consider giving them limited power of attorney. It’s going to make you faster and more lean, and it’s just another system you can put in place so you can move quickly on deals. It may sound crazy if you’re just starting out, but in a lot of markets it’s not unusual at all for a house to go up first thing in the morning and have an accepted offer in by 9am. Giving your realtor the power to sign for you puts you in a stronger position to buy real estate. If this system gets you three or four extra deals a year, that can really be huge! Think about the value of getting that extra deal for your business.
You should definitely consult a lawyer before you give your realtor any paperwork to sign. Get you lawyer to draft a limited power of attorney that gives your realtor the power to sign purchase agreements and documents for the purpose of buying and selling real estate. Be careful, be cautious, and consider making your business a little bit faster in the marketplace.