Need Serious Help In Pennsylvania With Assigning Contract

[Dwayne Gilbert]

I have the luxury of living in Pennsylvania which is known for its' crazy real estate transfer taxes etc.... So during my education and research I discovered, contrary to all the gurus teachings, that Pennsylvania is a pain with wholesaling as they like to hit people for a double transfer tax which makes it super expensive and many times even impossible to profit from a wholesale deal.

Regardless of all this, I discovered on here that doing an option to purchase agreement and then assigning that agreement was a strategy that many people have been using to effectively wholesale residential real estate in Pennsylvania legally and profitably. Now I have an option to purchase for a house in good condition needing very little repair. The contract is for 125,000 and I have a buyer willing to pay 152,000. So I did an assignment agreement with the buyer and myself. He is wanting to get a USDA loan and to my knowledge that is one type of loan that does not require that the buyer purchase directly from the name on the deed of the property which has to be owned gby that person for a certain period of time.

So his bank is telling him he needs a purchase agreement with myself, which I told the loan agent about the deal, total turkey who doesnt take time to listen. So we did that and he then comes back and tells my buyer that I can't be the one he buys from because of this name on the deed situation. Maybe it's his banks policy or something, but regardless.

I need help on where to go from here. I have a buyer waiting and ready. I have a seller anxious to get it done. What I need to know is how to execute the option to purchase agreement and how to assign it or what type of financing the buyer could get etc.... Any options are welcome. I have scowered this site, google, and youtube for weeks and countless hours trying to find some solution to this.

Please Help in PA,

Dwayne

[David Lee Hall, III]

@Dwayne Gilbert I would suggest find yourself a local mortgage broker that can find and match terms. This is a common way to get around FHA inspection requirements by having a conventional loan supplied that matches those terms. Plus that broker can run credit for you and the such to help you select an owner occupant buyer better.

That said, outside of knowing a couple folks that used them to buy places in the country I don’t have experience with USDA loans.

As a wholesaler in PA, the state expects 2x transfer taxes to be collected. (This is per multiple attorneys I have worked with.) My buyer pays mine as the assignment contract states they will pay all costs to close - including stamps. Many folks I know don’t even do assignments they just file memorandums and then collect a release fee and hand over the original contract. I have known buyers that have had issues explaining this particular scenario to lenders because their name did not appear anywhere on any contract for the property. I personally find this method shady but some gurus swear by it. I know a guy that lost a deal and switched to this method because of that.