Newbie Flipping Question
When I get a good deal under contract to flip, am I obligated to buy the home myself if, say, I cant find a buyer or the buyer doesnt show at closing? I know about building a good buyer's list, but I'm just talking worst case scenario here.
It's going to depend on what your contract says with the seller and also what your agreement says with the flippee.
For instance, say you have the unconditional right to assign under your purchase contract with the seller. You and your flippee sign an agreement whereby you assign to flippee your rights, title and interest in the purchase agreement with seller. To be sure, you should ask an attorney, but in that scenario, it seems to me that you're off the hook with the seller if flippee doesn't close with the seller. (However, you may be out whatever assignment fee you were supposed to get from flippee, depending on when flippee was to pay you that.)
Suppose you can't find an assignee. One way to head that off might be to put in your contract with the seller a contingency for a "feasibility period". Call it whatever you want, but its purpose is to tie up the property for X period of time while you try to get the flippee. The provision would say that the purchase contract with the seller would automatically terminate at the expiration of the "feasibility period" unless you gave written notice to the seller beforehand that you were continuing with the deal. If you don't get the flippee during that period of time, you bail out of the deal.