Is there any restriction on wholesaling or flipping REOs? Does the property needs to be purchased under LLC or can be individual name? Appreciate the advise. Thanks.
You can wholesale an REO but those deals are difficult enough without complicating it trying to wholesale. You may have better luck flipping unless you are an experienced wholesaler. Personal or LLC doesn't matter as long as you have the money.
@Aminul Karim Welcome to BP. From my reading of many other posts on this topic, REO Contracts generally prohibit "assigning" the Contract to a different person, which means that before you can wholesale or flip their property, the property has to be paid for and title transferred into the name of the person/entity on the Contract.
As @Rob Beland said, personal or LLC doesn't seem an obligation; just depends on your own risk/strategy parameters. [No legal advice given]. Cheers...
I am sure they are out there, but I have never heard of a REO contract that can be assigned.
You can own in a LLC or personal name, just make sure to do some research on which will suit your investment strategy the best.
Banks don't allow assignments on REOs (or short sales either). You may read about other ways people have come up with to get around this (i.e. double close, buy in the name of a LLC and sell/transfer the LLC, etc), but those are more advanced strategies that may or may not work for you or you particular scenario.
As for what name to buy in, it can be your company name or personal name. Either one works but keep in mind that whatever name you enter into the purchase agreement under, the bank will expect you to close under the same name. This could be an issue in some scenarios if you intend to close on the property yourself, especially if you're financing the purchase. For instance, if you entered into the purchase contract under your LLC name then the selling bank will want you to close using that same name, but the bank doing your loan may require that you take title in your personal name because they don't do loans to LLCs. You can see how that might pose a problem.
Lots to think about. Bank owned properties aren't the easiest to try and wholesale.
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