All Forum Posts by: Sam Wilson

Hey, guys,  

My wife and I are purchasing a house that we have been renting for the last 4 years.  The owners are separating and want to just get out of the deal, so we are getting the house on assumption of the current loan amount.  In our assumption paperwork, they require an, "equity statement signed by all parties confirming amount of equity or net proceeds to seller is not greater than $0."  It appears that the "$0" was the default value in the form and we can decide what the net cash to the homeowners will be.  We were planning on paying them $1500 each ($3000 total) so they can get some cash out of the deal.  

My questions are these: what does the equity statement look like and how does this factor into our contract price for the house?

@Christopher Thomas I, like you, am new to the business of wholesaling.  In my research, one of the biggest things that has jumped out to me are the "out" or "escape clauses".  These are specific clauses included in the contract that allow you a way to back out of your agreement if you cannot execute the deal as agreed.  It is critical, though, that you are clear up front with the seller with these so that if you do have to exit the contract he/she won't feel cheated or used.  I've even seen some people require the seller to initial beside each paragraph and clause as they read through the contract to insure this.  

Some examples of out clauses are: 

"contract subject to partner approval", "contract subject to inspection" "contract subject to due diligence" 

I would definitely consult with a real estate attorney about these.  I don't know about all attorneys, but I have one that is investor friendly and willing to explain these things to me free of charge.  He may be the exception, but perhaps you could network with some that might help you out.  Always return the favor buy using him to help you close!  

Regarding the letter of intent, my (limited) understanding is that there should be a signed contract that gives you a controlling interest in the property before you can market. I'm not sure if the LOI alone will satisfy the controlling interest requirement. Again, find an investor-friendly attorney to help clarify.

 Forgive me if this is a dumb question... if I were to buy it subject to, when I'm ready to move out, is there a problem with me renting it to someone else or would I have to refinance first?  

Thanks, @Chris K.  

Thanks, @Dmitriy Fomichenko .  I've been listening to the podcast for a couple of days now (listened to three episodes at work today).  Thanks for the other tips.  I'll definitely  use them.  

I have an odd question:  I'm currently renting a property in Charleston, SC from some friends who have moved to Washington State (I'm the tenant).  Unfortunately, they are going through a rough divorce and need to get this property sold.  They asked about me assuming the loan, but I don't know that I qualify. I'd love to use my resources to find them a solution, but I'm new to investing and don't know what options would be appropriate for this situation.  If I were not the renter, I would approach it from either a wholesale or perhaps a subject-to deal if there isn't enough equity.   Would it be weird/unethical to try and find a buy/hold investor to wholesale it to with me being the built-in renter?  Is that a conflict of interest given my relationship to the owners?

It sold in '08 for $159 which is about equal to the current comps. I'm waiting to hear back what kind of equity is in the place, but I doubt it is significant.  Any ideas on how to proceed?    

Hello, everyone!  I'm just getting started here and am highly interested in jumping into wholesaling.  Any advice on which articles/posts to read up on?  I've done a good bit already and have a fairly good grasp (I think...) on the concept.  Just want to make sure I'm starting out on with the right info.  I'm especially curious regarding the contracts used, exit clauses etc.  I've seen the gurus' "one-page super contract" but am curious as to how these really hold up.  Thoughts?  Thanks.