Real Estate Investing Forums

Real Estate Investing => Bird Dogs, Wholesaling => Topic started by: PradaP on May 22, 2008, 12:11:23 pm

Title: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on May 22, 2008, 12:11:23 pm
How do i go about a contract assignment if the home seller has a realtor what are the steps because im kind of confused? :banghead

Thanks
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: tampasteph on May 22, 2008, 08:42:22 pm
If it's not a bank owned property then you can just put and/or assigns after your name on the contract and then assign it to your buyer.

Also, I think that if the contract doesn't specifically state that it is NOT assignable, then you can assign it, so you wouldn't even have to add the and/or assigns.  Someone correct me if I'm wrong about that, but that's what I've been lead to believe. 

Steph :cool
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on May 23, 2008, 04:47:56 am
tx for the timely response,  :biggrin
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: slewi on May 23, 2008, 07:36:57 pm
Doesn't the realtor already have the property under contract?
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on May 23, 2008, 08:00:51 pm
im pretty sure they have a contract to help sell not buy, so i was wondering if I get the contract on the property do i go therw the owner of the property or the realtor? i have my own real estate conract will the realtor use  mines or his but i have a clause in mine saying what would be his percentage at closing? and last but not least what if the bank owns the property how would that assignment deal go?
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: TVREA on May 24, 2008, 12:17:54 pm
Assignment clauses are not that typical when a seller is using a realtor, however it is possible.  You would just need to make an addendum to the contrat and add it there.  Its better to do it then not to becauce once a buyer finds out you are selling it for more than they are selling to you for they might try to get out of the contract.
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on May 24, 2008, 01:53:42 pm
tx for the advice but what happends when the property is owned by the bank and there is not realtor so how would that assignment go?
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: tampasteph on May 24, 2008, 02:53:54 pm
Most bank owned properties are listed w realtors, and they will not let you assign them.

You have to do a double close instead. 

This topic has been discussed on this forum many times at length- do a search and you will find plenty of info..

Steph :cool
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on May 25, 2008, 12:00:18 am
Oh ok, thank you very much for you response it was very helpfull for me thank you. I have a another question how much equity does a property need to have enogh so it could be a good wholesale or assignment deal?
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: Lamar on May 25, 2008, 04:12:43 am
Anlong with what Steph said,

You also want to make sure you protect yourself. If you're not licensed, then they may accuse you of acting as an agent. Not to worry, just get some type of disclosure that states you are not representing the seller or the buyer, and your intent in the transaction. I've seen various names for this type of form. The ones I have used are Sales Checklist, Sales Disclosure and/or Affidavit. Some key lines you'll see in this form, that the seller and buyer need to intial off on are:


We understand that_______________ is not a licensed real estate agent.
W eunderstand that_______________is not representing either Buyer or Seller in thistransaction.
We understand that_______________has assigned his/her right to purchase the property to Buyer.
We understand that_______________ intends to makea financial gain in this transaction.

and more...

I get this type of form initialed and signed by both the seller and buyer on all my deals. It won't hurt you, by having this form, but it may hurt you if you don't. :deal

Disclaimer: I am in no way shape a form an attorney, nor am I offering any type of legal advice. The information I gave you is from my own experience. I am in no way shape or form guaranteeing you that all will be perfect with the information I gave you. Please speak to your attorney for further scrutiny...

Ok, I think that covers my butt. lol

Good luck on your deal.

-Lamar
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on May 25, 2008, 02:07:26 pm
Lamar i just want to say thank you for you most respected and informative reply. i have one lil question in the fill in lines you gave me does my name go in their or the buyer and seller?

Thanks a lot
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: Lamar on May 25, 2008, 06:08:56 pm
Your name goes there. The buyer and seller need to initial next to each line, acknowleding each line.
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on May 25, 2008, 09:01:16 pm
Well i want to say thank you because you gave me another safety blanket to get under when things get crazy i will re-type mines and put that in there. i thought by just saying and or assigns by my name and having a clause saying I pradap may not be end buyer of this property. The right wording on a contract will save your butt  :beer  , i wonder sometimes what will be a good min and max to make on each assignment deal?
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on May 29, 2008, 12:24:00 am
i have drove around town for dollars and found 70 homes vacant or FSBO.
 i want to know what is the cheapest way to get comps on the homes i found? and find out how to get the info of the owners of the vacant homes, i try to search the tax records but it said what is the owners name and idk that is what im trying to find out.
I need some :help people.

Thanks
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: herbster on May 29, 2008, 07:17:37 pm
I don't know how things are where you live but where I'm at I can search tax records by name, address or parcel no.
I dive into township records and look for bs&asoftware in Mi.
Some townships call parcel and land search, others call it equalizer data base etc.
Hope that helps. herbster
PS visit your county clerks office.
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on June 02, 2008, 12:23:20 am
thank you very much, i am trying to figure out when to do the comps b4 or after the contract sign because i was thinking b4 so i can negotiate from that ARV. and what is the best way to get a realtor to do comps for cheap or free?
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on June 04, 2008, 11:01:52 am
NM I found a couple new sites where i can get free comps from this fourm, my question is what are the correct steps from begging to end on how to do a assignment deal?

Thank you. :beer
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: scostell on June 04, 2008, 12:43:39 pm
The best advice anyone can give you is to search this forum for "Assignment".  You will learn everything you need to know about assignments as well as a bunch of other things as you read through posts.  This takes a lot of effort but you will learn it, retain it and understand it. 

Hope that helps

-Scott
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: Lamar on June 04, 2008, 11:08:44 pm
Prada,

      Don't second guess yourself or over analyze. Get the deal under contract, set your assignment fee, market it to an investor and just assign the deal. You can get paid upfront or at closing. Just make it happen. No Excuses! :beer

Oh and the way to get comps from Realtors is by building a relationship and asking them. They'll usually do it for free. Give Value and you shall recieve Value! :bobble
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on June 10, 2008, 12:39:50 pm
i see and understand what you are saying lamar but i just wanted to be sure on what was the comps and ARV when i was trying to negociate a lower price. ill just find a property put in under contract and just market it but my thing is this do i do the title work or let the investor so his Due dillingence on the propety?

Thanks a lot  :beer
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: amesda on June 14, 2008, 06:27:33 am
I guess what I hear you saying in this matter is that the process of wholesaling is the same whether the property is listed with a realtor or not. Correct?

I say many properties here that are listed with realtors that may be a wholesale deal; however, what to do if the realtor and/or real estate company requires pre-qualification? This is where we run into a snag. We find great deals, however the agent always seems to say that we need pre-qualification before ending the phone call. What do we use for pre-qualification? Our credit is shot, 2 bankruptcies, yadayada,ect...We are on the up swing taking care of some things. Wanted to do wholesaling to pay off debt so that we could increase our credit lines and be approved for things.

Dan
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: amesda on June 14, 2008, 06:30:20 am
Also, to my previous post, I might add, how do you assign bank owned properties? I didn't think that was possible. However, according to TampaSteph, that is possible. We just have to do a double close. I am familiar with them only because I have been studying them.
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on June 14, 2008, 01:23:46 pm
Thank you very much Dan for your timely and effective info. Yea i found out a couple weeks ago you would need to double close a bank owned property. For realtors i wont have to deal with them because im just doing FSBO'S its less of a headache for me. for assignments i thought i would have to do a title search but someone told me a real investor will do his own homework on the property.

so what im going to go find the homes, run comps find arv then get the lowest possible price put it under contract, and market it to my buyers list of only nine buyers lol. but i know what they want and where they want it so someone will buy it.

Thank you
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on June 18, 2008, 11:50:34 am
thank you everyone who read and replied to my post im am more educated now in wholesaling than i ever was.

Thank you you all  :beer
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: TheDealMaker on June 20, 2008, 02:24:22 pm
PradaP,

I'm with you on the FSBO's (don't know what part of the country you're located in) however, in my correspondence with FSBO's they're very "tight" with the money....even though their ad for their house may say "negotiable" my experience has been that they pretty much want full Retail and they don't want to budge much (guess they aren't MOTIVATED enough at this point). Going in, we already know they don't want to pay the 6% realtor fee, or any split  on it, much less any concessions....any suggestions on this? OR, do I wait a little longer till they become More MOTIVATED? Thanx ~ John   :beer
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: frankfromjoisey on June 21, 2008, 03:25:28 pm
Also I get good info from my local newspaper website. There I can find recent sales, tax records showing what the house is worth and a nice foreclosure list etc...
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on June 25, 2008, 12:05:38 pm
i 100% agree with frank i always do that and waiting on someoe is somewhat good but letting them think on your offer as you do others well make the wait seem shorter. depending on the how long the house sits on the market will determine how long you will wait on the offer being accepted.

Prada P  :beer
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on July 04, 2008, 12:02:52 am
wholesaling is the best way to get started in real estate with less risk.  like i tell myself NOMORE excuses   get the money and get to the next deal ASAP.

Prada P  :beer
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: Experienced Wholesaler on July 06, 2008, 11:20:27 am
do i go therw the owner of the property or the realtor? i have my own real estate conract will the realtor use  mines or his but i have a clause in mine saying what would be his percentage at closing?

If it is listed by a Realtor, you could very well have a pain in the ass if you deal directly with the Seller. If you have a legit buyer, then just tell the Realtor and you might be able to get them to split a % of the commission with you (It is their legal right to collect the commission then pay you. They will just 1099 you for that amount so they are not taxed on what they pay you and you can invoice them).

Might make the structure a little easier to achieve.

In my experience, at some point you are going to have to deal with the listing agent, who legally is the gateway to the Seller, so better to get it out of the way.

YES they do have the power to do 2 things:
1) Interfere with the closing if they are not paid, and
2) Sue the Seller later if they are not paid based on the contract terms that they have with the Seller.

One thing you might do is discuss (carefully) the Seller exempting himself from the Exclusive Marketing Agreement by writing it in the special conditions section of the Agreement with the Realtor. The logic to the Seller being, the Realtor didn't procure you as the buyer.

I do not advise cutting out agents though (ask me how I know this  :argue been there, done that)

Why not go after recently expired listings?  :biggrin

Great job, keep it up!
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: j1dias on July 06, 2008, 08:03:50 pm
If it is listed by a Realtor, you could very well have a pain in the ass if you deal directly with the Seller.[/b] If you have a legit buyer, then just tell the Realtor and you might be able to get them to split a % of the commission with you (It is their legal right to collect the commission then pay you. They will just 1099 you for that amount so they are not taxed on what they pay you and you can invoice them).

Experienced Wholesaler - I am sorry to say that, but you are way, way off... :O) A Realtor cannot split commission with an unlicensed person. Any Realtor knows about this and actually this is probably one of the negatives about being a realtor - you can't offer a commission or a bonus to anyone that brings you a deal... :O(

A regular investor can put out fliers stating that he will give $500 or $1,000 to anyone that brings him a deal. If that investor was a Realtor, he would not be allowed to do that... :O(

And even if you could find one that would take the risk and split the commission with you, he would need to do that under the table - he would never be able to give you a 1099...

Have a good Sunday!
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: Experienced Wholesaler on July 07, 2008, 05:51:07 am
I appreciate the correction on that topic.

I may be wrong about that, and I will double check my sources.

I agree, the straightforward way you explained it would not be the way to do it. I am not advocating doing anything that is prohibited, and there is often a legal way to do things but that always depends on your advisers.

Quote
Experienced Wholesaler - I am sorry to say that, but you are way, way off... :O) A Realtor cannot split commission with an unlicensed person. Any Realtor knows about this and actually this is probably one of the negatives about being a realtor - you can't offer a commission or a bonus to anyone that brings you a deal... :O(

And even if you could find one that would take the risk and split the commission with you, he would need to do that under the table - he would never be able to give you a 1099...
However, I have a colleague who has had a relationship with an agent such that he has been paid a fee for services that has been structured, with the help of his accountant, so that it is completely legal and deductible as an expense.

I think it comes down to how the agent's business is corporately structured.

Again, this particular point isn't one of my areas of expertise, and I will admit it, but I know that if you have the right structure you have some flexibility.

Thanks for the clarification, again, I will double check into HOW it has been done.

Continued success! :biggrin
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on July 07, 2008, 11:06:49 pm
thanks guys, expericend wholesaler i have one question, is it legal to do the procedure to cut the agent out i mean how do i do that. without a legal mess up tell me more about cutting the agent out?

Thank you  :beer
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: j1dias on July 07, 2008, 11:37:49 pm
thanks guys, expericend wholesaler i have one question, is it legal to do the procedure to cut the agent out i mean how do i do that. without a legal mess up tell me more about cutting the agent out?

Thank you  :beer

PradaP - are you sure you want to do this? What about the Golden Rule? How would you feel if you were the realtor and someone was trying to cut you out of the deal? No deal is worth your peace... :O)

Just my 2 cents. Have a nice evening!
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: htjohnson on July 09, 2008, 06:27:36 pm
whats the deal with reo not excepting assignments. everybody gets what they want don't they? i contacted an agent here and he said the same thing. are there ways around rejection from realtors?
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: j1dias on July 09, 2008, 08:01:46 pm
whats the deal with reo not excepting assignments. everybody gets what they want don't they? i contacted an agent here and he said the same thing. are there ways around rejection from realtors?

htjohnson - realtors can't reject an offer. They are agents, not principals. Only the principal can accept or reject an offer. There is one exception to this rule, but it is not relevant for the discussion.

What I believe happens most of the time is that we talk with the realtors on the phone and ask if the bank would accept an assignment, or if the bank would accept a contingency, or if the bank would accept this much... The realtor tells you NO and you feel your offer was rejected...

One thing though you need to realize is that noone rejected your offer, because there was no offer. Until you put it in writing and send it in, there is no offer. My suggestion is to write it down and send it in. The realtor will be required to present the offer to the bank (again - there is one exception) and then it is up to the bank to accept or reject.

My suggestion to you - put your offer in writing and send it in. If the realtor comes back saying that the bank would not accept it, than politely thank him for his insight but insist that your offer be presented anyway. The realtor is required to present the offer.

You will be amazed on how different some people react to offers in writing. Some people will tell you no over the phone, but end up accepting it if you put it in writing... At least this is my experience with negotiations (not real estate related...).

Good luck!
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: Experienced Wholesaler on July 11, 2008, 08:03:01 pm
thanks guys, expericend wholesaler i have one question, is it legal to do the procedure to cut the agent out i mean how do i do that. without a legal mess up tell me more about cutting the agent out?

Prada P, I must agree with J1dias, I do not agree with going around an agent on a deal.

Honestly, just pay the people in the deal.
However, be a smart negotiator.


After several years filled with experiences of deals that have gone haywire because someone was cut out of a deal, I have come to the point where I see how the business works better when people are making money. Getting cut out of a deal has caused angry, even violent reactions from other parties who feel entitled.

Do I know how to legally cut out Realtors, other investors, and anyone else in my way??

YES!!

Would I??

NO!!

It's bad business, bad for the industry.

When it happens to you (like it happened to me) you see that that kind of unethical behavior makes it hard for EVERYONE to make money.

Here's an idea:
Learn how to negotiate with the Realtor for a flat fee, or something in your favor.
If you are bringing the buyer, you can have a reasonable cause to help the Realtor see the advantage of working with you in a way that makes you feel satisfied.

Also, why not wait till it's expired...
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on July 17, 2008, 01:48:04 am
i want to thank both of you for your response i would like to know how to cutt a realtor out of the deal? just incase i need to because i want to know how to be the middle man or cutt out the middle man.

Thank you  :beer
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PHXrealtor on August 03, 2008, 12:01:54 am
I am a Realtor in AZ, and I've submitted numerous REO offers on behalf of a wholesaler client of mine.  Of the 20-30 offers we've made, only 1 bank has come back and said they would not allow the contract to be assigned.  So, I would definitely make offers on REO's with an assignment clause.  The worst that can happen is they reject your offer. 
Title: Re: How do i go about a contract assignment if the home seller has a realtor?
Post by: PradaP on September 24, 2008, 10:51:26 pm
 :coolthe best way is to pay everyone invovled because i do believe in Karma but i just wanted to how becaus i didnt know thta you actually could.