I've came across a motivated seller out of state. We've agreed on a price already. My question to you all is what are the next steps I'll need to take? Getting the property under contract? If so, what type would I need? I look forward to your responses. Thanks!
Congrats on your find. That's very exciting! Have you looked at the contracts under the Resources tab on BP? There are a few contracts on there that seem to be pretty popular. And anyone, please feel free to correct me if I'm wrong--these do not have to be long, convoluted documents. A few pages, normally, should suffice.
I hope this helps.
All the best,
So from there do I just need to email/fax it to the seller get a signature and move from there? When would I need to get a title company involved?
I am new to wholesaling also but I will suggest to take your time with process. If you know of someone in a law office, please have them review the contract before submitting it. Once, you have good understanding of the verbiage on the contracts (purchase and sale agreement plus the assignment contract). You will be able to proceed without any future issues.
Yeah I'd make sure it clearly spells out:
- terms between seller and buyer, who pays what closing, how much earnest money?, prorated tax/ins who pays, days for contingency for inspection, some out clauses if you cannot find the buyer in time, definitions of property, partners, etc etc
You'll want to bring the seller side contract to the closing/escrow agent to drop your earnest money in per your contract verbiage so that you have an enforceable contract since you dont want to write down earnest money to be deposited in 3 days after mutual acceptance if its day 5 and you still havent sent in your EMD.
Then you find your buy side contract and submit it into the closing/escrow agent, draw up the assignment instructions to the agent or double closing instructions to the agent to follow.
Cash/hard money comes in from end buyer to close seller side transaction in a double closing, records, then the remaining proceeds goes to close the buyer side transaction (between you and end buyer) minus your closing costs will be your net cash proceeds.
If you chose to do an assignment the deal gets consummated as one transaction not two with the double closing and the assignment that goes to you shows up in costs of the transaction with the the original seller side contracted price showing to the end buyer. This might be an issue for some end buyers especially if you're making a killing. I'd just set up the right expectations with the end buyer about the transaction to see which route may be best for you to take.
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