"Handwritten" cash buyer letters

This is for the home sellers - several times a year our neighbourhood gets these notes in our mailbox.   I just got one yesterday. 

It usually inspires a lot of chatter on the local Facebook groups. So are these legit or are they too good to be true?  Well, here’s what I know about these. 

If you’ve seen the ads for seminars and conferences about how to make money in real estate, quite often this is the strategy they are teaching.  Often they're pitched as buying real estate with little money down.  

These notes are usually from a group of investors, pooling their money together to buy homes.   They look low key & designed to look hand written.   I imagine they appeal mostly to people who haven't been able to renovate, estate sales, or people who have not been able to keep up with repairs.  Here's what the one I received looks like:

Cash buyer letter that looks handwritten


So how do they make money?  From what I understand, they make money one of two ways; they either 'flip' or 'assign' the purchase contract itself or buy homes below market value to renovate and re sell. 

Often they will buy homes for less than a house would sell for on the open market.  Their pitch is you can save real estate commissions.

Method 1 Assigning or reselling the purchase contract: Once they have purchased a property, they will try and assign the paperwork to another buyer before the home closes.  They are basically reselling their purchase contract to a second buyer. That way they make profit without having to pay out a hefty land transfer tax, which is due on closing.   Is this legal?  Yes it is!  As a matter of fact, it happens all the time with pre-construction condos where the original buyer will try and resell the unit before closing.  They are trying to assign the contract for a profit - the catch is the second buyer may pay substantially more for the contract than the seller made with the cash buyers.  And none of this money filters down to the seller. 

Method 2 Flipping.  I'm sure you have all heard about house flippers.  They purchase a house, renovate it and resell it for a profit.  This is a totally legit way of making a living.  But when house prices, mortgage rates & construction materials increase substantially, profit margins fall. This is where the 'cash buyers' come in.   They will offer to buy your home for substantially less than market value so they can flip and resell. 

Both of these tactics bring up 3 important questions to me: 

1.  Is there a benefit to selling to an all cash buyer?   Yes, this is a thing in the USA.   But in Canada our mortgage laws are different - which is why we were protected from the US crash that happened in 2008. In Canada it makes absolutely no difference to the seller whether your buyer is taking out a mortgage or not.  

2. What happens to the deposit money? I am not sure how the deposits work for this type of purchaser, but for organized real estate, we are bound by regulations to make sure deposits are protected.  Brokerages and lawyers must have Trust accounts to keep the deposit money safe for consumers.  And if a buyer can’t close or decides to walk away from a purchase, there is a strong case law that the seller will get to keep the deposit money.  I am not sure how secure the deposits are with the cash buyers from the flyer.  

3. As a seller, how do you know you're getting market value?  As a real estate professional, we spend a lot of time learning how to price properties - both for the benefit of the seller - to get the best price, and buyers - so they don't overpay.  We do this by analyzing and comparing sales and home features.  While some of this information is available publicly, the details (and how to interpret them) are available to Realtors.  And it always pays to get a second opinion! 





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A disturbing trend I've come across recently is the fraud in the rental space.   As an agent who handles a fair share of rentals; these issues have shown up over several ways this year.   I'll tell you about 3 instances I've had and the red flags that appeared with each! 

When I'm representing a landlord and an application comes in, I spend a lot of time going through an applicants documentation and getting references and looking through their background.  Here's what I do:

  • Call their employer by finding the employer's website and calling through their office to confirm employment.  I don't just call the supervisor on the application
  • Look carefully at the documents to see if they are real; company letterhead & credit reports can be faked or bought
  • Check social media & linked in
  • Call past landlords
  • Make sure there is a building at the address they're currently renting
  • Check that the landlords name and property owners names match.   If it's an apartment building call through the property management company if it's an apartment rather than calling the number provided.
  • Look at the credit report for signs of altering

With those things in mind, let's look at 3 things that have happened to me this year!

1.  Student rental Scam - fake rental and landlord

First of all, you should never have to pay to submit a rental application, or be asked for a deposit before you get a chance to see the place.   These scams are generally ads on sites like Kijijii and Facebook for rentals that look too good to be true.  They also steal MLS listings for homes and advertise them at lower rates.  I came across one recently through a family friend desperate for some student housing.  It was a big scam; and when I called them out they 'protested too much'.    Here's how to spot these scammers:

  • They demand payment to submit a rental application
  • They demand a deposit before you see the unit
  • Makes excuses why they are not available to speak to on the phone 
  • Will only communicate through messenger, text or email
  • The advertised price is way lower than other rentals
  • Their Facebook profile was just created
  • Their Facebook name does not match their user name ID (see the URL) 

2. Fake Rental Applications   

There are some very good forged documents out there.  I had some people submit an application on a lease I was advertising and here's what I found during the checks, among the other checks I did as above :

  • Inconsistencies in addresses on the application
  • Employment letter does not look real - no header or footer with information on the company letterhead

3. Forged Tenacy Papers

I had a call from a gal who had a great story, good employment, good credit, moving to Toronto from outside the city for work, can't come in to look for a place so needed virtual showings.  Could I help her find a place.  Sounds great right?  

Now I don't usually check tenants out before I help them (and I'd helped out a client with an out of town move this year already in a similar situation)  But with everything going on right now, I felt it couldn't hurt to see what her references would say.   So she sent in her application & 

then came the paperwork - the address of her job didn't match up with her story.  The company had never heard of her or her supervisor.  There was even no property listed at the home she had put for her address!  Other red flags for scammers include what she did:

  • get overly upset when called out 
  • provide complicated excuses for 'mistakes' on application forms
  • call the fact checker a liar, unprofessional, etc.

So be careful out there folks! 


A big thank you to the communities of Guildwood, West Rouge & Port Union for the terrific support last Saturday for my Community Shredding Event.  About 30 families participated - and their generous food donations filled our Jeep to the brim!   The food donations were taken straight to Feed Scarborough - the Scarborough Food Security initiative and will be distributed to local satellite food banks in the area.   Judging from the huge line up outside the Manse Rd. food bank Saturday, it's much needed. 

Chartwell Guildwood was my partner for this event and provided the venue and great snacks.  Thank you Kelly & Dianne for your wonderful support.  As always, Papersavers was gracious, friendly, professional and helpful!  

One interesting sideline - My husband, myself, Dianne and Alex from papersavers all grew up within the same area!   Such a big city/small world!