Agent & Investor · Los Angeles, CA · Member since 2015 · 56 posts · 36 votes
Hey BP!
I'm a real estate agent in Los Angeles and I'm working with some flip clients. They want to know if they can assign their contract (for wholesaling purposes) in escrow without the seller's approval of the assignee.
Other agents I talk so say you need the seller's approval, others say they've never heard this question before. I'm new to working with flippers and don't want to mess this up.
Investor · Nashville, TN · Member since 2015 · 688 posts · 607 votes
11y
Call a real estate attorney in your area. This could be a state of California thing. I've never heard of it being illegal if the contract is already assignable
Investor · Los Angeles, CA · Member since 2014 · 50 posts · 58 votes
11y
The standard CAR purchase agreement is not assignable without seller's permission unless you have added language to that effect.
Here's how to handle: Get the potential assignee comfortable enough with the deal to be ready to go forward with no contingencies. Then, have a lawyer draft a document which does the following: assigns contract to assignee and removes assignee's contingencies, all conditional upon seller's approval. Have the latest draft a side agreement between assignor and assignee which spells out how / how much assignor will get paid by assignee if deal closes (don't show this one to Seller).
Seller will probably be OK with approving assignment if, in doing so, assignee simultaneously removes contingencies. That way, seller knows the deal is happening.