How to set up a deal with two wholesalers involved?
hi, I am working with another wholesaler right now and we may be splitting the profits on a deal. I've never worked the same deal with a wholesaler before so I wanted to ask you how this is typically done.
1. The other wholesaler secured the seller, and I am bringing the buyer. In this case does the other wholesaler assign interest to me, and I assign interest to the end buyer (using separate assignment contracts)?
2. If we do use 2 assignment contracts as mentioned in the scenario above, will there be 2 line items for separate assignment fees in the HUD statement, or just one?
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Yes two assignment contracts are perhaps the simplest method. That way you both have an equitable interest in the property and there can be no claim of brokering without a license.
It would be up to the title company as to how many lines for assignment fees on the HUD-1. I suspect most will want to put two lines.
If I was concerned that there would be two lines, the 1st contract could be assigned to me & the other wholesaler jointly for no fee, and then reassigned from both of us to the new buyer. That way there would only be one fee to the two of us together as a joint venture.
That is not meant to be legal advice but simply how I might structure a similar transaction good luck - Ned