Possible to sell SFR contract done through Agent
HI, I am new to wholesale and I have a very basic question. I have a property under contract (from MLS and through my agent) that I originally intended to either BRRRR or flip. I changed my mind and want to back off from the contract.
My question is, is it possible to sell such a contract? Based on my reading, a general wholesale process does not engage agents (i.e., no listing agent and no buyer's agent). Would appreciate any advice!
#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- Austin, TX
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#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- Austin, TX
You can wholesale any TREC 1-4 contract in Texas as long as there was not a clause that specifically states that the contract is unassignable. The biggest obstacle you’re going to face is getting the realtors on board. A lot of them don’t like assignment and think it’s illegal, WRONG
@Jason Sung. Have you mentioned this to your agent? Will you do all the work to wholesale this and manage that part of the transaction with title as you are now looking at a double close. And your click is ticking. What is the contracted close date ?
@Jason Sung if you have an assignable contract you could sell the paper (assign it). If not, which most on-market mls contracts are written up un-assignable, you could always double close. You do not need anyones permission to double close. If you plan on doing that, I would consider making your realtor aware. Other than that, all you’d need to do would be find a buyer. It helps closing both transactions with the same title company, but if the seller chose the title company be cognizant that title may let the seller know about the double closing, so you’ll want to navigate those waters carefully.
#2 Wholesaling Contributor
- Wholesaler
- Irvine, CA
@Jason Sung everyone is giving good advice here. I work Texas as well. If you want to assign it, then an Amendment would have to be done that the seller signs that acknowledges the assignment. If you want to avoid that, you could try to do a double escrow, although it seems like those are harder and riskier to pull off, as far as many escrow companies won't do those and what if your buyer disappears or doesn't perform on time. Also, your agent should be privvy to everything that's going on, and as long as you find a good buyer who will actually perform, I think your agent should be okay with it, maybe.
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Real Estate Agent
- Cash Source Homes
Possible? Yes. Likely? No. You don't yet know what you don't know which means you can't explain it to an agent who likely has little to no understanding of how an assignment works. You'll have to be sure the contract doesn't include a prohibition regarding an assignment. Many title companies will not close an assignment UNLESS the seller specifically agrees to it as well. If you assign the contract and the buyer fails or refuses to perform, you're still on the hook to close UNLESS the seller specifically releases you, as assignor, from all obligations. And this is before you get into the issues relating to lenders for the assignee. Close and re-sell. If you lose money, you've at least learned a valuable lesson.
Quote from @Daniel Paloscio:
@Jason Sung if you have an assignable contract you could sell the paper (assign it). If not, which most on-market mls contracts are written up un-assignable, you could always double close. You do not need anyones permission to double close. If you plan on doing that, I would consider making your realtor aware. Other than that, all you’d need to do would be find a buyer. It helps closing both transactions with the same title company, but if the seller chose the title company be cognizant that title may let the seller know about the double closing, so you’ll want to navigate those waters carefully.
@Daniel Paloscio Thanks. I learned 'double closing' thanks to you!
#1 Wholesaling Contributor
- Flipper/Rehabber
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#1 Wholesaling Contributor
- Flipper/Rehabber
- Wilton, CT
Relatively anything is possible right? That doesn't mean you should.
A lot of wholesalers try to go at it the lazy way. They want to become succesful but they are not willing to do what it takes to do so.
It takes work, it takes finesse, it takes knowledge it takes experience, it takes hustle. It takes doing the things you may or may not want to do.
A lot of people get a list together with what they are able, or willing to do, to become succesful and then ask the question, I have this this and this, how can I make it?
Instead do this..
I need this this and this to become successful, how do I get this this and this?
If you need X,Y and Z to become successful, it is completely irrelevant if you have A, B, C, D, and E... stop asking how to become successful with A, B, C, D, and E... and start figuring out how to get X, Y, and Z.
So to answer your question, can you wholesale a listed property?
Who cares...
Start figuring out how to truly make it in this space.
Hint?
Get a website, make it credible, then focus on social media paid marketing and SEO.
End of debate, this is not a matter of opinion, this is 100% pure unfiltered FACT!
Quote from @Jason Sung:
Quote from @Daniel Paloscio:
@Jason Sung if you have an assignable contract you could sell the paper (assign it). If not, which most on-market mls contracts are written up un-assignable, you could always double close. You do not need anyones permission to double close. If you plan on doing that, I would consider making your realtor aware. Other than that, all you’d need to do would be find a buyer. It helps closing both transactions with the same title company, but if the seller chose the title company be cognizant that title may let the seller know about the double closing, so you’ll want to navigate those waters carefully.
@Daniel Paloscio Thanks. I learned 'double closing' thanks to you!
Awesome! Glad I could help! Feel free to reach out if you run into any other bumps in the road!