Specialist · OH · Member since 2019 · 59 posts · 18 votes
Buyer reached out to me saying he works for a professional home buyer and is buying 15 houses a month in my area. He makes full price offer requesting to use his title co. I told him I had to stick to my usual title co. He says ok deal... my question is what happens next. I send him the original purchase agreement I have with the seller, and an assignment contract. He fills the assignment contract out. Then when do I have the seller sign the assignment contract? When do I give the contracts to the title company? Does all of this happen after my buyers inspection period when he decides if he is doing the deal for sure, or does all this happen during his inspection period?
@Austin Wood congrats! I also locked up my first wholesale deal this weekend. The process depends on the terms of the contract and the offer you have. We went with an offer with no contingencies so that we didn't have to worry about someone walking away after an inspection and we signed the assignment immediately. I'd probably send the P&S over to the buyer immediately so that if they have any issues with it you aren't waiting until after the inspection period to find out.
You don't necessarily need to have the seller sign the assignment, but it doesn't hurt to have them sign it. I was up front with the seller and she knows exactly what I'm making on the deal, but it can be an uncomfortable situation if they weren't aware or if you're making a lot more than anticipated.
I'd check with your attorney or title company as well and ask them to take a look at everything.
@Austin Wood congrats! I also locked up my first wholesale deal this weekend. The process depends on the terms of the contract and the offer you have. We went with an offer with no contingencies so that we didn't have to worry about someone walking away after an inspection and we signed the assignment immediately. I'd probably send the P&S over to the buyer immediately so that if they have any issues with it you aren't waiting until after the inspection period to find out.
You don't necessarily need to have the seller sign the assignment, but it doesn't hurt to have them sign it. I was up front with the seller and she knows exactly what I'm making on the deal, but it can be an uncomfortable situation if they weren't aware or if you're making a lot more than anticipated.
I'd check with your attorney or title company as well and ask them to take a look at everything.
1. Since the buyer agreed to purchase, on your assignment agreement you are going to make sure the buyer commits by putting down a sizeable earnest money deposit. 3k as an example
2. Your assignment agreement will not offer any contingencies to the end buyer as Erica stated.
3. Depending on if your state is an attorney state or not; submit assignment agreement to the attorney/title company.
4. Buyer have 24-48 to submit earnest money, the deal is still available to other buyers until em is submitted.
5. Inform seller that you and a partner will need to have access to the property for final walk through before closing.
6. Title company will coordinate the rest (title work, mortgage payoff etc....)
7. Make sure your seller can have everything out of the house they want prior to closing. Sellers sometime believe they can go back in the house once it closes and deed is recorded.
8. I suggest since it's your first deal you meet the seller at the attorney/title company so you can ease any concerns the seller may have and so you will know how the process works.
Hope this help. Let me know if you have any questions.
I would add - have the EM paid to you to reimburse for your EM paid -- or have yours released from title simultaneously - make sure any option periods and close dates sync so you have time to terminate if end buyer terminates or defaults - disclosing all to seller is great. Best to do this at beginning versus after assigned - if you are making too much and cannot disclose, you can close via AB/BC -- ie double close