Need First Deal Help!!!!!
Here's the deal: I have located a property that I can buy at a big discount. I wan't to tie it up under contract and then "assign" it to another investor. My question is about the contract. Can I use a normal RE sales contract and just add "or assigns" after my name as the buyer?? After I put the house under contract then I will negotiate a price with another investor which will include my fee. Now how do I make sure that the investor will honor the contract and not leave me hanging? Do I get some earnest money from them or just make sure I have other investors lined up in case he jumps ship? I know that I need to include escape clauses in the contract, but is there anyway to assure that the investor will show up at the closing table? My last question is how does the closing process work? Do I need to set this up as a double closing, or does the investor just show up in my place? This part really cofuses me!!! Please help out this newbie!!!! :-?
Hi Pannet:
Very simple solution. You can use a normal real-estate contract. You don't have to worry about putting "assigns" after your name. Just simple open up escrow as an assignment and put in a small deposit such as $500.00. You then go and find your wholesale buyer.
You then have your wholesale buyer reimburse you for your deposit and pay you your fee and then contact escrow and tell them who your are "assigning"
your escrow to. They will draw up an amendment that you and the seller signs. This is the easiest way to do it.
Best Riches,
Jeffrey Adam
[addsig]
If You still need help you can call me at http://www.thecreativeinvestor.com/modules.php?op=modload&name=Forum&file=faq#rules and I would be glad to help you out if you still need it. James
[ Edited by JohnLocke on Date 04/16/2004 ]
how hard is it to find a wholesaler? Is there a website where wholesalers and finder go?
Thanks for the input but it is kind of confusing. I thought you put the house under contract with an "assign" clause and then this gives someone else the right to close in your place. My question is how does the closing process work and how do I recieve my fees. Do I need to put my "finders fee" on the contract? I'm still confused, please help!!!!
is there a book on assigning contracts that I can buy?[ Edited by heyshid on Date 04/16/2004 ]
Pannet:
Dont worry about putting an "Assign" clause in the contract. However,you need to open escrow as an "Assignment". When you find your
new wholesale buyer, you have him cut
you a check for the difference between what you are buying the house for and what you are selling it to him for. You then contact escrow and have them "assign" him the escrow. There are other ways to doing it, like getting paid from the HUD-1 at closing, however
I have found this way to be the best.
You can also arrange to have the new
buyer pay you at closing or even when they sell the house if you trust them.
Each situtation is different. I would recommend getting paid as soon as you "assign" your escrow to prevent any future problems.
Best Riches,
Jeffrey Adam
[addsig]
pannet,
In PA, agreements of sale contain a provision either specifically allowing or prohibiting assignment--in other words, assignment is not a right that's assumed. It must be specifically stated in the agreement. Don't know if KS is like PA in this respect, but I would suggest you get the answer from your real estate attorney.
Pannet:
If you are going to be "Wholesaling" you are totally fine using your standard purchase contract and not mentioning anything about "Assigning."As long as it is stated in the escrow instructions that you have the right to "Assign" you are alright as long as the seller signs them.
One more strategy you can employ is find a hard-money lender in your area or private lender that will allow your wholesale buyers to assume the financing as long as they have decent credit. Then you can just simply close in your own name and wholesale to your
"Wholesale Buyer" with financing in place. You will have buyers lined up at your door!
Best Riches,
Jeffrey Adam
_________________
"The only place success comes before work
is in the dictionary."
[ Edited by JeffreyAdam on Date 04/16/2004 ][ Edited by JeffreyAdam on Date 04/16/2004 ]