How is wholesalling done in CA ?

Question

Hi every body. I am new in RE bussiness, However, after listening to several seminars, I  have decided that whole salling will be he most appropriate way for me to start up. I live in CA now, and the agent I spoke too about my plans thought it will be illegal,since I don't have a license. Can you explain or help break down the process of wholesaling down so that I see how i can apply it here in California? can some one tell me how to reassign a contract, and what to do if i must close on the property before selling. What happens if I put a deal under contract and I cannot find a buyer. How can I walk away from the contract without any financial obligation?
I will appreciate your imputs, thank

Michael Quarles · Answer

either get an option or a contract (with your name and/or assigns, as buyer)

That isnt required in California    That is a right unless the contract says it isnt

John Adeiza · Answer

Thanks  Jaremy, Eddie, Michael, and Rod. Your imputs where very helpful.  I will proceed to build my buyers list and find a realtor for MLS access. I will be throwing some more questions in the process. One more thing, does anybody knows the market in southern Califirnia?
Thanks.

Rod Marlow · Answer

My 2 cents...If the deal seems worth going after..Tell the seller your offer is "contingent on your "funding partners" approval"...and put down 100 dollars(in writing) as good faith to hold for cpl days while the numbers all get verified and you get your funding partners to walk thru and approve etc..then if they don't like it or the #'s don't work..you lose 100 bucks worse case..cause your funding partner backed out(recoup from him).But i think you are fine backing out if you make the offer..you have the right to back out..I think so anyway..I am not offering legal advice lol... far from it..I assume someone will correct me quickly if i'm wrong here  :-)

Go for it..you'll make it

Eddie Price · Answer

all realtors say that, if anything they can help you find buyers and get you MLS access.

Jaremy Moritz · Answer

I'm not in CA, so I can't give any specific advice on your market.  Wholesaling, in general, is done by:
1.  find a deal
2.  either get an option or a contract (with your name and/or assigns, as buyer)
3.  market the property to your buyers
4.  once you have a buyer for the property, either assign your contract or revert to step #2 and get the contract signed so you can assign it to your buyer
5.  when your buyer closes on the deal, you get paid

All the forms you need can be found online for free or for next-to-nothing.  The key is to have your "escape" clauses in the contract or option agreement.  Again, I'm not familiar with your market, so I don't know how effective an option agreement would be, nor do I know if it's a common practice there.

Common clauses I use in my contracts are:
"This contract is contingent upon buyer successfully assigning this contract to a qualified end buyer."
"If buyer is unable to successfully assign this contract, the contract will become null and void with no recourse to buyer."
"Seller understands that buyer intends to assign this contract to an end buyer."

Any one of these will do, in my opinion, but consult with an attorney in your area just to be safe.  What works in Houston may not work there...