You’re about to make an offer on a self storage investment. You’ll need two things: an LOI (letter of intent) and a PSA (purchase and sale agreement). You may need to use one or the other or both, depending on your situation, but not having these two contracts could be stopping you from getting your first or next deal done.
Today, AJ and Conner explain precisely what a PSA and LOI in real estate are, the key difference between these two crucial contracts, and how to use them to make offers on facilities that owners can’t ignore. This is how the pros get self storage deals done. No verbal offers. No handshakes. This is when it gets legit.
You found a self storage investment you like…what do you do now? Do you use an LOI vs. PSA first in commercial real estate? We’ll walk through which contract to use when, what to include in an LOI and PSA, the contingencies to add that ensure a seller can’t wrongfully back out, and why you always negotiate with the seller before you get one of these signed.
The next time you and a seller sign these agreements, you’ll be on your way to your next self storage deal.
What you’ll learn in today’s show:
- What an LOI and PSA are in real estate (and when to use each of them)
- What to include in your initial offer to a seller (timeline, price, contingencies, and more)
- The one contract that stops a seller from coming back to you to ask for more
- Why you always negotiate with a seller before you sign one of these contracts
- Seller not responding? What to send them to show that you’re a legit buyer
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🌳 Work with someone experienced in self storage loans at Live Oak Bank! We seriously love them. https://www.liveoakbank.com/business-loans/self-storage/
📑 Our Self-Storage Feasibility Studies will help you speed up the process in understanding markets, potential risks, and analyzing the facility itself. https://cedar.cc/feasibility-studies/
