looking to close my first wholesale deal in new york

13 Replies

Im looking to close my first wholesale deal in dutchess  county New York, but i can not find a investor friendly title company that will do assignments & double closes ! Also the seller wants $4000 down for 4 1bd condo ! I know from doing research that i can get this done with a very small ernest fee using a contract, or none at all. Can someone please extend some advice or contacts? 

Try Kim Ortega (owner) Marissa or Lauren at Regency.  They are a small shop and may be open to what you are looking for.  I use them almost exclusively for my deals.  Good folks.

845-471-8100

hey Bob thanks for the information!  Unfortunetly they dont do those type of deals ! Im still searching but it seems like nobody does assignments & double closes in new york! Can anybody recomend ?

re: "using a contract, or none at all" and your trouble finding an agency...

Are you trying to do this without lawyers on both sides?   Unlike other parts of the country, (to the best of my knowledge) you can't do a real estate deal without attorneys in NY.  This was one of my big surprises/disappointments when I started.

You read everywhere, "I write the contract on a napkin and then have my title co do the closing" ....but that won't fly here.

So, maybe you are asking the wrong question, to the wrong people.  If you ask a RE Attorney if s/he does double closings, assignments... I'm sure you will get "yes" to that (and may be just what you need here in NY).

once again thanks for the advice Bob! I think i found a Re attorny that does double closes, but im not sure what questions to ask him?  Again i know i have a good deal on my hand, but this will be my first and i am starting off with no money!  the seller is motivated but he wants $4000 in earnest money For 4 1bd condos!  Any advice?

@William Barthelmeus  

I don't have any experience wholesaling, so I'm sorry I don't have any advice/suggestions.

Originally posted by @William Barthelmeus :

once again thanks for the advice Bob! I think i found a Re attorny that does double closes, but im not sure what questions to ask him?  Again i know i have a good deal on my hand, but this will be my first and i am starting off with no money!  the seller is motivated but he wants $4000 in earnest money For 4 1bd condos!  Any advice?

I would be cautious about the $4000 earnest money. We planned to flip a property in Atlanta, but when our private lender backed out 5 days before closing, we had to wholesale the deal. There must not have been enough in it, because we were not able to assign it and lost $5000 earnest money. That was our first wholesale deal- live and learn. Now, we only offer $100 and will ante up maximum $500- no exceptions. If the seller is truly motivated, they will take it. Or, if you think it is truly a great buy, just know loosing your EMD is a risk you have to be willing to take.

Best of luck to you. 

Pat Mulligan

Parrigan Group LLC

@William Barthelmeus In my contracts I basically state that my $100 earnest money will be deposited after inspection approval. That gives me time to inspect the property and market it to my buyers and get a buyer on the line before I even put the $100 earnest money down. My buyer puts the EMD that I require down. For this, I might say $5000 non-refundable for my buyer.

If you can't get it sold within your inspection period, you let the seller know that the property did not pass your inspection and your funding partners refused to accept it. This is true, because all of your funding partners (aka "buyers") refused to move on it because the price was too high and/or it needed too much in repairs. Make sure your buyers give you a number that they need based on the property's current condition. Now you know your target. 

This gives you an opportunity to either back out of the agreement legally, or renegotiate the price you need----which is the price your buyers are willing to pay minus your desired profit. 

This strategy is essential as a wholesaler to never lose money. I rarely put my own earnest money down. 

thanks everyone i appreciate the advice!  Iv actually Tried offering a $100 earnest deposite, but he said he thinks his attorney is going to laugh at that! He at least wants $1000 in escrow! The problem is money is a big problem for me right now and i really dont have that to cover if i cant sell the condos! What should i do, or how should i confidence this guy to take the offer? 

@William Barthelmeus You can always move on and seek other deals and more motivated sellers.  If this guy is refusing the budge on the EM, he's probably not too motivated.  Or scrape together $1,000 and make the offer.  That's a reasonable amount: most offers I've done have been for $1,000 EM.  It shows you're serious.

Good luck!

- Tom

HI William,

I only pay a $1 EMD. I basically tell the seller and their Attorney that this is an all cash transaction and would not pay any deposit unless it was necessary the bind the agreement.

I currently have two houses under contract (1) $52,500 in CT (2) $135,000 NY - both have $1 EMD

Are we talking about an actual earnest money deposit or an option fee here? These numbers sound more like an option fee. I've honestly never heard of a serious buyer putting down $100 EMD. It could be a bit of semantics, but there might be a miscommunication here. As a seller, I would expect a MINIMUM 3% EMD and the more, the better. We've even offered 100% EMD to demonstrate we were serious (that was an MLS property w/competition, though).

@Alan L.  Can you recommend a real estate attorney in New York who's reviewed the contracts you use?

Thanks.

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