Wholesaling help and answer

Right now I have a seller who's looking to sell and a buyer already in the works... This happened so fast I really didn't have time to really figure out my exit stragedy and now I'm in a pickle...

My main concern here is;
1. The right and legal paperwork here for my State of Michigan. I am newly licenced also, so I'm even more confussed if I have to use the long 6 page agreement with the seller or can I use a basic P&S agreement through my LLC.

2. Also, how am I'm going to want to set this up for closing with a title company for both parties and myself to collect a check.

Long story short, I have nothing legally binding on this home, only an unrecorded option... But this seller is totally on board with me helping her out... The buyers on board also, but is only approved for a loan for the amount I'm asking... This turned out to be not a cash deal like I was figuring... Both these parties are eager, ready and waiting...

Any help would be greatly appreciated...

Scott H.

Real Estate Investor · Ohio

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Mar 17 '11, 01:50 AM

Having a loan involved will make this a bit more complex rather than a cash buyer. If cash you could've just done a double closing using the end buyers funds to work the entire process through the title company and pass the title through. That said, the lender is going to want the funds to be direct through the title co for a single closing. So, I would work up and agreement between you and the seller for the agreed fee that would stipulate that the fee is to be paid from the seller's proceeds by the title co directly. Then complete only one purchase agreement directly between the buyer and the seller to satisfy the lender's stipulations. The title co can either pay this as a marketing fee or consulting fee directly through the HUD or can even paid POC so that the figure doesn't show up on the HUD to reveil to the buyer just how much you are actually making. I would insist on this with the title co and the seller. Then the purchase agreement will be for the full price, the seller gets what they want, you get paid and the buyer gets the property.

Steve Craver

Real Estate Investor · Marne, Michigan

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Mar 17 '11, 02:12 AM

Thanks so much for the reply Scott...
Now I guess my next question would be how would I go about getting this type of agreement?

Scott H.

Real Estate Investor · Ohio

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Mar 17 '11, 02:26 AM

I sent you a collegue request. As for the agreement, what I use is either a basic MFA or mostly a Proceeds Management Agreement which is more for the title co than anything. Basically just a document that gives instructions to the title company on how to disburse the seller's proceeds outside of the closing.

Rob Gillespie

Wholesaler · Valley City, Ohio

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Mar 17 '11, 02:46 AM

Congrats on the deal! If I am reading correctly, you are licensed? As an agent? If that is the case, just do a listing agreement to get put on the HUD. It does make it much more complicated when the buyer is getting a loan. If your fee is not too much, do an assignment of contract for the option. The assignment fee will pay you for the option. This will only work if the buyers have the cash to pay you out of closing. If you have any questions or want some more advice, I would gladly give you 15 minutes of my time to explain it in detail. Good luck!

Rob Gillespie, Rob The House Guy, LLC
E-Mail: rob@robthehouseguy.com
Telephone: 330-800-9043
Website: http://AskTheHouseGuy.com
Rob@RobTheHouseGuy.com 330 800 9043 AskTheHouseGuy.com RobTheHouseGuy.com

Steve Craver

Real Estate Investor · Marne, Michigan

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Mar 17 '11, 09:31 AM

Thanks so much guys, I'll be getting back to let you know how it goes...

Rudi Susanto

Developer · Jakarta, DKI Jakarta

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Mar 22 '11, 09:07 PM

So how the things going on?

Jimmy C.

Real Estate Investor · Clearwater, Florida

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Mar 22 '11, 09:18 PM

Definitely just do a listing. Otherwiae you have to close twice and may have seasoning issues with the end buyers lender.

Steve Craver

Real Estate Investor · Marne, Michigan

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Apr 27 '11, 09:28 AM

Amazing how well this turned out!!!
That's $4500 bucks baby! :D

A very HUGE thank you to Rob The House Guy!
And also Angelo Russo who he put me in touch with to make this all happen... You guys I will Never forget!
And to hell with all the so called gurus, who never called me back...
I say come to Bigger Pockets guys, and do your best to get your answers here!

J Scott

Real Estate Investor · Atlanta, Georgia

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Apr 27 '11, 09:51 AM

Congrats Steve!

J Scott, Lish Properties, LLC
Telephone: 770-906-6358
Website: http://www.123flip.com
http://www.123flip.com

Will Barnard

Rehabber · Santa Clarita, California

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Apr 27 '11, 10:49 AM

And to hell with all the so called gurus, who never called me back...
I say come to Bigger Pockets guys, and do your best to get your answers here!

Steve, congrats on your deal and paycheck. You are welcome to thank BP Nation by making a donation to the site or purchasing a Pro Account. All the info on this site is free, but BP needs income to keep bringing us better and better services.
This of course is only a suggestion.

Happy Investing and good luck on the next one too! :D

Will Barnard, Barnard Enterprises, Inc.
E-Mail: info@barnardenterprises.com
Website: http://www.barnardenterprises.com
info@barnardenterprises.com

Niel Kluszczynski

Real Estate Investor · South Bend, Indiana

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Apr 27 '11, 10:55 AM

Congrats!

Matthew Rose

Real Estate Investor · Honolulu, Hawaii

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Apr 27 '11, 11:55 AM

Awesome & inspiring Steve, good for you! And way to go RobTheHouseGuy!
Hope I make this type of post soon.

Angelo Russo

Real Estate Attorney · Fairview Park, Ohio

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Apr 27 '11, 11:32 PM

It was a pleasure working with you :) Congrats on your first deal done

Joshua Dorkin

BiggerPockets Founder · Denver, Colorado

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Apr 27 '11, 11:43 PM

Congrats Steve! I wish more people would post up their check photos. We could make a pretty awesome gallery of these!

Joshua Dorkin, BiggerPockets, Inc.
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Telephone: 877-831-4704
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Be sure to check out the BiggerPockets Blog at http://www.BiggerPockets.com/renewsblog/

Rob Gillespie

Wholesaler · Valley City, Ohio

Pro

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Apr 28 '11, 02:27 AM

Steve,
CONGRATS!!!!!!!! I am truly so happy for you man! I know it feels great to get that first deal done. Thanks so much for the wonderful testimonial! Lets keep the momentum goin, and get on to the next deal!!! :D

Marcus Mccray

Real Estate Consultant · Monrovia, California

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May 02 '11, 10:36 AM

Congrats Steve!
Question: Did you include the assignment fee in the sales price?
I'm asking for info on a similar deal that I have coming together out here in CA.