Contracts to secure interest for wholesaling?

Question

Hey all so working on getting something in motion here, and we are at the point where we are ready to make offers on houses, one thing we have not covered yet was the contracts with the home owner. Is there a template that we can use? Or is there a specific kind (named) contract that we need to ask an attorney to draw up? Our goal is to find our first house, and get a contract in place to allow us to market the property for the owner, and protect our interest in the property so another investor that we may contact for the purchase, doesnt go around us and deal direct to the seller. Much appreciated, this site has been amazing and even better than college! Thanks.

Julie Marquez · Answer

I'm not an expert, but from my understandings of the Washington State law, you must be a licensed real estate broker to market properties that you do not own. Most wholesalers don't really "market" and just assign a contract as soon as possible, as to avoid the possible problems you are trying to avoid. They are more word of mouth and underground. If you want to market the property, get your license.

Julie Marquez · Answer

@Joe Bender I don't see agents and wholesalers working together, as they have a different agenda. As an licensed agent, it is their job to have the sellers best interest in mind and get the highest selling price for the property (where they also make a commission of the sale price). On the other hand, a wholesaler is trying to get the lowest price from the seller and the lower the price, the more profit money the wholesaler can get.

If you want some good reading about wholesaling processes, read the Ultimate Guide to Wholesaling by @Brandon Turner. There is extra good information regarding the state law for us Washingtonians, since Brandon is a Washington resident himself.

Scott Hildebrand · Answer

Its pretty easy in WA. Just make sure you disclaim warranties and transfer the contract, not the real estate.

Joe Bender · Answer

Thanks Julie,

Just heard podcast 92 and was already checking that out. Thanks for the tip, makes total sense.

Alex Chin · Answer

@Joe Bender - most wholesalers that I know do not work with a real estate agent, they have their buyer lists (a pretty easy thing to figure out in the Seattle area, anything that is remotely a good deal will get snapped up in a heartbeat) and just put out an email blast and first come, first served.

Joe Bender · Answer

Alright good advice, thank you. So how would we draw up the contract to be able to market the contract? Seems like a technicality to get around law but I understand the concept and can appreciate there is an alternative.

On a second note, do most wholesalers network with real estate agents to handle the marketing of the property then?

Contracts to secure interest for wholesaling?

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