The strategy I use is to use some legaleze. It goes over a lot better than something like "this agreement may be assigned to another party".
Here's the exact wording I use:
"This Agreement shall be binding on and inure the benefit of the heirs, executors, administrators, assigns and successors in interest of the respective parties."
Would this work with a properts listed with a Realtor? There are severl bank owned porperties in my area that I am looking at but I have heard (from Realtors) that a Realtor's contract cannot be assigned, nor would the bank approve the contract on their property assigned.
Astro:
You may request any contract be assigned. The problem that I beleive your Realtor was trying to point out is, most banks will not accept a contract with an assignment clause. You can still submit one if you like, but the bank will surely counter to remove the assignment clause.
Good Answer Mr.Ford! You are absolutely right. Everyone is preaching these days the "And or Assigns" clause. The problem is not only as you mentioned, however what I have seen happen is once a seller sees that, they get worried that you are not going to be able to close, or are flipping their house for more money. You risk the chance of them backing out. Of course every situation is different.
Here is a simple solution. Open escrow as an 'assignment'. After your seller signs the escrow instructions you can call up your seller and tell them you are going to close in your partners name for tax reasons. Theoretically this is correct because you are taking out part of the profit and passing the rest on to your wholesale buyer. This has worked well for me.
Best Riches,
Jeff Adam
P.S.- Doesnt Ford stand for:
F- ound
O-n
R-oad
D-????
[addsig]
As long as you don't change the entity of the LLC you should be fine.
One option is to close in your name and then Grant Deed to your wholesale buyer and have them assume the financing in place with your hard-money lender or private investor. This has worked very well for me.
As mentioned earlier, when buying bank reo's, they want you to close in your name on an accepted offer. No problem!
Close in your name, collect fee from your wholesale buyer, grant deed them the property and have them assume the financing. I will take it a step further. Get your wholesale buyers 'approved' with your private lenders and hard-money lenders so that after you grant deed the property to them, there will not be a problem for them to assume the financing in place. It will be very easy to wholesale to your buyers if you have 100% financing in place.
Ron Legrand says that saying "Brenda Grossnickle and or assigns" does not make the contract assignable. It is more to do with your heirs, that the contract will survive after you do not survive.
Keep in mind that with my experience once you make an offer on a REO the bank will counter with their form with all of their conditions and such. Anything extra that you write in will throw up red flags.
I still like double closing a lot better than assignments of contracts. I have never assigned any contract other than to/from entities that I own.
yes - as long as an assignment clause is stated, which it is in your case.
The strategy I use is to use some legaleze. It goes over a lot better than something like "this agreement may be assigned to another party".
Here's the exact wording I use:
"This Agreement shall be binding on and inure the benefit of the heirs, executors, administrators, assigns and successors in interest of the respective parties."
Would this work with a properts listed with a Realtor? There are severl bank owned porperties in my area that I am looking at but I have heard (from Realtors) that a Realtor's contract cannot be assigned, nor would the bank approve the contract on their property assigned.
It really has little to do with an assignment clause. It has more to do with any clauses that would restrict your ability to do so.
Jeff
Astro:
You may request any contract be assigned. The problem that I beleive your Realtor was trying to point out is, most banks will not accept a contract with an assignment clause. You can still submit one if you like, but the bank will surely counter to remove the assignment clause.
Good Answer Mr.Ford! You are absolutely right. Everyone is preaching these days the "And or Assigns" clause. The problem is not only as you mentioned, however what I have seen happen is once a seller sees that, they get worried that you are not going to be able to close, or are flipping their house for more money. You risk the chance of them backing out. Of course every situation is different.
Here is a simple solution. Open escrow as an 'assignment'. After your seller signs the escrow instructions you can call up your seller and tell them you are going to close in your partners name for tax reasons. Theoretically this is correct because you are taking out part of the profit and passing the rest on to your wholesale buyer. This has worked well for me.
Best Riches,
Jeff Adam
P.S.- Doesnt Ford stand for:
F- ound
O-n
R-oad
D-????
[addsig]
What about contracting the property in the name of an LLC and then assigning the LLC? The bank should be fine with that, right?
As long as you don't change the entity of the LLC you should be fine.
One option is to close in your name and then Grant Deed to your wholesale buyer and have them assume the financing in place with your hard-money lender or private investor. This has worked very well for me.
As mentioned earlier, when buying bank reo's, they want you to close in your name on an accepted offer. No problem!
Close in your name, collect fee from your wholesale buyer, grant deed them the property and have them assume the financing. I will take it a step further. Get your wholesale buyers 'approved' with your private lenders and hard-money lenders so that after you grant deed the property to them, there will not be a problem for them to assume the financing in place. It will be very easy to wholesale to your buyers if you have 100% financing in place.
Best Riches,
Jeff Adam
[addsig]
Jeff,
Great ideas! Thank you. It looks like the best way to wholesale (preserve profit and anonymity) is to bring in a private investor.
Know any private investors that would like to make a quick $2,000 for financing a 100K deal in escrow at the attorney's office for half a day?
JohnCl
Ron Legrand says that saying "Brenda Grossnickle and or assigns" does not make the contract assignable. It is more to do with your heirs, that the contract will survive after you do not survive.
Brenda
Keep in mind that with my experience once you make an offer on a REO the bank will counter with their form with all of their conditions and such. Anything extra that you write in will throw up red flags.
I still like double closing a lot better than assignments of contracts. I have never assigned any contract other than to/from entities that I own.