Assignment Fee
Hope everyone is having productive day. My qustion is this, When a contract is agreement is being finalized between an investor/buyers how is it looked when someone like myself want s to be sure that I have a principal who can perform seeks part of their assigment fee at the signing of contract by the assignee, and the balance @ closing? I've been out of the loop for years because I was burnt by investors yrs ago after putting them & the seller together. When I tried to get my money after the deal closed his response was I thought they paid U. So now I want some of mines up front & record it just in case because all investors aren't honest but too greedy. Thabks alot...for any input you can give. Sincerely Benyamin
Ben,
Your one sentance is confusing
Quote:
how is it looked when someone like myself want s to be sure that I have a principal who can perform seeks part of their assigment fee at the signing of contract by the assignee, and the balance @ closing?
But I think I have the jist of it. When you sign the assignment of contract, you need to collect the same earnest money deposit you gave to put the property under contract.
Then you show up at settlement. The assignment should be on the HUD-1, and you get your funds then.
Ben,
I wholesale as well as buy from other wholesalers. For me personally, I will not give anyone cash until closing. Let me give you a couple of examples.
1. As a wholesaler, I put a target property under contract. I give the seller a promissory note for $500 as an earnest money deposit. I then get my buyer invoved. To assign the contract, I require him to deposit $500 with my title company as an earnest money deposit. My assignment fee is then paid to me at the settlement table.
Now a variation to that scenario is what John Locke does. He gives the seller a $10 earnest money deposit in cash. That works well for him, and I know many others who do that. Regardless of whether you give a note, or a low cash deposit, you are still out no or very little money.
2. As a buyer I put the earnest money deposit with my title company. Then pay the wholesaler at the settlement table.
I personally never let cash out of my control until settlement.
I believe U represent perhaps a good number of investors who are truly principals who can perhaps move fast enough that it may not make much of a difference.
I'm glad U are doing well for yourself. By the way would U happen to have a copy of your assignment fee agreement that I may look @ it's language?
It would be greatly appreciated as I am working hard to provide for my grandchildren having lost job & I figured from all the studying I've done & can continue to do that now is the time to get moving. And just maybe I have the success as many of U here.
Thanks again for all your input & may God Almighty continue to bless U immensely.