Options
I am planning on putting a property in pre-foreclosure under an option. When I sign the option agreement (Ron LeGrand's) with the seller, it gives me the option to buy. When I assign that option to someone, what agreement do I sign with the person I'm flipping to? (can I use the assignment of contract agreement?) And when the person I'm flipping to buys my option, does it matter that his name is not on the option agreement I signed with the seller?
Thanks for your help!
you would put after your name ''and/or assigns'' just like in a purchase contract. the assignment form is an ''assignment of option agreement''
Roger
Thanks for your response. I thought I heard in Ron LeGrand's course that in an option agreement (unlike a purchase & sales agreement), if you don't put and/or assigns, it still can be assigned. Is this true?
Without the ''and/or assigns'' the agreement is between only you and the seller. You could not legally assign it without the seller's written consent.
By signing the agreement with the above clause in it, the seller gives up this right to decide if the contract can be assigned.
Put yourself in the sellers position. Wouldn't you want to know who will be showing up at the closing table? If you plan on flipping/assigning contracts, I suggest that you let the seller know upfront your intent. Whether they sign the contract with the assignment clause in it or not, they will be very unhappy with you if you don't tell them BEFORE what you are doing.
Roger
LeGrand's point is that the phase 'and or assigns' sometimes raises a red flag for the seller. He therefore suggests not using it and argues that if the agreement doesn't say it can't be assigned then is can be. Of course it depends on the situation, but as a rule I think it's better to be up front with the seller about what you plan to do with the property.