I negotiated a purchase price with a buyer on a property I have under contract. The buyer is finishing the process with a realtor. The realtor asked me to sign a contract prepared by him using a PA realtor association contract which lists me as a consultant paid by the seller. How would I assure I get paid at closing if I don't use my assignment contract? Would it be beneficial to have me paid by the buyer at closing as a consultant instead?
Hm. Maybe ask to voluntarily put a lien or cloud the title until you get paid?
I think escrow handles it. At least in CA. I'm pretty sure it will be on your closing statement in escrow where it spells out all the costs and credits and debits to buyer and seller.
You control the deal? Use your contract or refuse to sell it.
You can use theirs and I'm sure its legit but if you control the property control the transaction.
What kind of deal did you negotiate with the end buyer, an assignment of your purchase contract OR a straight purchase? Does the seller know you are assigning for a fee, so maybe he wouldn't mind the fee on his side of the HUD? Is the buyer trying to finance? If not, leave the fee on the buyer's side. You can't sign a contract with different clauses and requirements with your buyer, different than you have with your seller, or you could create problems/liabilities for your self. An assignment of your contract is the cleanest.
I agree with Tim 100%, it sounds as if you have no control. Your deal your rules. If the Realtor wants to pay you as a consultant than that means the seller is likely being ask to pay at least a 3% commission or since they are not represented by a realtor a full 6% commission as there listing agent and will complete a double closing. In this case the sellr will be losing about 6% less then you agreed to get them paid.
You should have the deal under contract, in escrow with your choosen title company and the title company will have this as a pending property automatically preventing the buyer from purchasing with out you.
Also a factor is if the buyer is represented by a Realtor are the buying cash or conventional. If the Realtor wants to pay you as a consultant then they are savey enough to understand what your are doing and there for should be easy enough to talk to realistically.
Thanks guys. The buyer is using a consturction loan to purchase and fix the property. The buyer doesn't want to sign the assignment and wants to pay me on their side of the hud as an consultant.
@Chris Harper Someone is misunderstanding something. If the buyer "wants to pay you on his(buyer's) side of the HUD" that means he is buying directly from the owner, not from you. Otherwise there would be no fee on his side, it would just be included in the purchase price. This means your contract with the owner Has to be assigned to him, if he's buying from the owner with your fee on his side of the HUD. Him financing it creates additional wrinkles, as he won't be able to include your fee in the price to determine his loan amount.
Join the Largest Real Estate Investing Community
Basic membership is free, forever.