How do you get paid for your assignment of contract

Question

When assigning a contract as a wholesaler to an end buyer how do you get paid, in cash upon assignment or at closing (and do you need to provide closing instructions)?

Is there a particular process?

Brian P. · Answer

There are several ways. upfront being nice, but in reality a investor does no't want to pay you upfront, especially if the two of you don't have much of a history together and that was fine with me if the investor had a track record of some sort. If not I wanted him to have some skin in the game, so demanded a partial upfront at least or some other arrangement.

Now on properties that would have a holding period on resale imposed by the lenders I used to have the seller sign a new contract with the buyer and pay me with a note and trust deed on the property to cancel my end which was paid off in escrow thus bypassing the holding period. So that is another way plus there are some other ways, check the archives. They are a fountain of information. I know I posted some detailed information, just can't remember if it was here or else where.

Timothy Rogers · Answer

Yes, that is all you do. You also give the purchase contract to the end buyer as well. I would also keep a copy of the purchase contract too.

Marcus Roberts · Answer

Thanks Tim.

So essentially after the assignment you would provide a copy to the end buyer, one for yourself and provide one to title (or closing agent)-stating that you have an interest in the property and expect to receive your fee or its balance.

Thus the day the properties closes you will be notified of your funds or they will be deposited if you do direct deposit, correct?

Timothy Rogers · Answer

Marcus Roberts It depends on the wording in your assignment contract. You can have it where you get half of the assignment fee when end buyer signs the assignment contract (nonrefundable deposit) and the another half at closing. I do nonrefundable deposits when I don't have a relationship with the end buyer. I usually have my end buyer sign assignment contract then I either fax or drive assignment contract over to title company and wait for closing to get paid.