I have a wholesale deal from a wholesaler in Maryland that I was initially going to purchase for a fix and flip. Another investor I know asked if he could buy it instead and has agreed to pay more for the property so I get a cut for giving him the deal.
So basically its an assignment contract between the owner of the property & the wholesaler. Would I then do another assignment contract between myself and the wholesaler? So that I can then have my buyer, purchase the property from me?
I confused as to how I should complete this deal. I don't want to give the title company 3 or 4 different contracts. I don't know how we go about structuring this deal. It initially was going to be a property I fixed and flip until another investor asked about buying it from me.
Contract 1 - Owner & Wholesaler - 80k
Contract 2 - Wholesaler & Myself - 100k
Contract 3 - Myself & End Buyer - 115k
Owner - 80k
Wholesaler - 20k
Myself - 15k
End Buyer - Property
@Trevor S Foster ok mate here's what you do. Easiest thing is to get a promissory note from the wholesaler that when the title company divides the checks up you get your share. Then contact the title company and make sure they know what's going on and know how the division of checks is to be carried out. Otherwise you could do a Jv contract with the wholesaler. Just remember to stay in touch with the title company so you get paid. Be the title companies contact person. That's the easiest way, there's lots of other ways. As far as contracts the fewer the better.
One contract between the seller and wholesaler
A Jv or promissory note between you and the wholesaler stating what your proceeds are going to be at closing. If possible take the wholesaler down to the title company and do the paperwork there. Make sure this is filed with the contract and everyone knows how much you're going to get at closing. I don't want to flog a dead horse but if you don't follow up or keep up to date with the title company you're not getting paid.
Now that that has been filed you can just have the wholesaler and your buyer write a normal assignment contract between the two of them. Which will be filed and handled by you the wholesaler and your buyer.
This is a cash transaction so it shouldn't be a long process. Make sure you go to closing and collect your check. Hope this helps
@Tim Hall I appreciate that detailed response. I ended up doing exactly what you said and you reassured I was correct. We did a JV deal where myself and the wholesaler are the sellers and assigned it to the buyer. As well as a promissory note with a break down of who receives what in the end. We're using my end buyers title company who we have both dealt with before, so it looks as if everything will go smoothly. I appreciate your help!
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