??? Could anyone tell me if there is a cap on assignment fees? I have done fees from $3000-$25,000. I live in the state of Virginia. Any advice? Thanks in advance…
Howdy Richburg:
The only cap I know of is where to cash those big checks. You should be teaching a birddog course or wholesale class if you are getting fees like that. Sounds like some incredible deals you have been finding and flipping. Good luck with it
hello can you tell me how you did your fee cap and what contrat forms did you use?
Helly Paatty:
There is no cap. I just used a standard sale contract to buy and an assignment agreement to sell. Title companies can help you with these or your local Realtor or online at your the states real estate commission.
LOL
I think I have to disagree. There is no cap, but many title companies that do double closes do not allow more than a 30% profit for the flipper or they will not insure the policy.
Being a Hard-money lender and just finished working with a Texas Bank on a loan designed for double closes, we also are going to follow the title company and not allow the flipper to make more than 30% and they have to leave 10% equity in the property.
The goal should be not to make all your money in one deal, but make good money at a lot of deals.
Just my 2 cents
Also, it has to depend on your buyers funding source, cash or is a lender involved. Of course cash it won’t have a limit. Luckily, I’ve had a $30k assignment just wish I had one per week
Richburg,
Could you give us some insight on some of your deals?
YEAH , I HAVE DEALS COME TO ME ,BUT I AM TRYING TO FIND BUYERS BECAUSE THEY ARE ALL OR 95 PERCENT OF THE ONES I GET COME TO ME ARE ASSIGNEES,AND THEY HAVE A STANDARD CONTRACT ON THE HOUSES THEY SEND ME. I WANT TO MAKE MONEY OFF OF THESE, I HAVE TWO INVESTORS MR LEE WINTERS AND MR ANDRE JOHNSON.THEY TAKE THE LEADS BUT NEVER ANSWER ME OR SAY THEY ARE NOT DEALS ,SO I AM TRYING TO FIND BUYERS FOR THESE ASSIGNEDD DEALS TO MAKE MONEY OH , MR WINTERS TOLD ME AFTER I ASK HE DONT LIKE ASSIGNEE DEALS THAT IT IS TO MANY MIDDLE MANS, ACTUALLY ME AND THE ASSIGNEE IS JUST 2 AND SOME OF THE ONES I HAVE SENT THEM COULD STILL BE A DEAL.
Hey guys, thanks for your replies on the cap question. I only search for ugly properties. Which leaves a lot of money for the investors, after the rehab work is completed. The investors get sub to apprasils for their loans. My selling strategy is different for each property. I do most of the due dilligence for my investors, because most are from out of town. Plus, I want the deal to sell smoother and quicker. I use local license contractors. I give them a scenario on how I want a property and they give me the estimates. The investor has the final decision on which contractor they will use. Two examples- Ugly house (3br/1ba), contracted for $23,000. Selling for $34,000. Rehab est. $31,000. Converts this sf into a 4br/2ba sf. Arv-$100,000 or $1000mo rental income. Actually sold for $32,000. Another, ugly house- (3br/2ba), contracted for $75,000. Selling for $100,000. Walking distance from local university. Rehab est. $35,000. Converts this sf into a 5br/2.5 student housing. Arv-$190,000 or $2500mo rental income. Actually sold for $95,000. As, you can see these are cash cows…
HELLO, HERE IN BALTO FORECLOSURE IS MOSTLY THE ONLY QUICK WAY TO GET UGLY HOUSE, AND GET A CONTRACT ON IT AND HAVE SOME KIND OF GOOD CREDIT OR SOME MONEY AROUND.WHAT I WAS SAYING IS I AM A NEWBIE AND I ONLY GOT ONE HOUSE SOLD AND COLLECTED A FEE OF 500 .NOW I AM TRYING TO GET A HOUSE I CAN CONTRACT MY SELF AND MAKE MORE MONEY ,BECAUSE MY INVESTORS DONT WANT ALREADY CONTRACTED HOUSES AND HAVE TO PAY ME A FEE TO ,OR I JUST THOUGHT MAYBE THE CONTRACTOR OF THE HOUSE I GIVE TO MY INVESTOR HAVE TO PAY ME IF HOUSE IS ACCEPTED,ANYWAY THEY SAY TO MANY MIDDLE MANS.YOU EVER HEAR OF JOE CRUMP AND STEVE MALET0S ?
I’m sure there is someway to work this out to where you can get more than $500. You should keep an eye out for more investors. I know people that do what you do and make about $3000-$5000 per deal. Try and find more investors look for sign we buy houses and sometimes when you see houses being remodeled ask the contractors who the owners are. Investors are always willing to work with anybody who can get them a good deal. The more investors you have the more choices you have.
THANKS FOR YOUR INFORMATION KATRINA, WHEN I MADE THE 500 DOLLARS , I DID NO HAVE A CONTRACT ON THE HOUSE .RIGHT NOW I HAVE A LOT OF WHOLESALES SENDING ME A LOT OF HOUSES THEY ARE ASSIGNING, SO I WILL BE ON THE LOOK OUT AS YOU SAID, AND LINE UP MORE INVESTORS, HOPELFULLY SOME THAT LIKE ASSIGN HOUSES ,OF COURSE I AM STILL LOOKING FOR SOME STRAIGHT FROM THE OWNER THATS FOR SALE TO PUT MY OWN CONTRACT ON. I ALWAYS LIKE TO HEAR FROM OTHER INVESTORS ,HOPE TO HEAR FROM YOU AGAIN AND THANKS AGAIN.
Richburg,
Are you located in Richmond? I am a newbie in the business and am in the process of doing my first assignment with a 20k fee. ;D
HELLO,NO I LIVE IN BALTIMORE MD.THATS A PRETTY GOOD ASSIGNEE FEE THERE.SO HOW MUCH DID YOU PUT DOWN ON YOUR CONTRACT OF THIS HOUSE ? DID YOU NEED TO HAVE A REALESTATE AGENT WHEN YOU PRESENTED YOUR CONTRACT TO THE SELLER ? OR ARE YOU GOING TO NEED A LAWYER WHEN SOME ONE BUY THE HOUSE UNDER THE ASSIGNEE AMOUNT.? I JUST WISH PEOPLE WOULD FILL IN THE SMALL BLANKS FOR THOSE WHO HAVE NEVER DONE A 1ST DEAL ,THEY EXPLAIN SO FAST THEY LEAVE OUT THE SMALL POTATOES OF THE DEAL AND LEAVE THE BEGINNER ASKING MORE QUESTIONS.WELL IT WAS NICE TALKING TO YOU.
As for the specifics of my deal, I found the house on a cold call and got it for 190k. Estimated renovation was 30-40k and ARV=275. I was planning on doing the renovation myself, but decided in this hot market to throw an ad in the paper. Got 2 offers at 210k. Once the contract was signed, I negotiated an assignment instead for a fee of 20k (that way I don’t have to pay any closing costs etc.). My attorney drafted the assignment agreement. No real estate agents were used. The only complication is that we are still obligated under the original contract so we really have to stay on top of everything to make sure the sale closes and be ready to close if it doesn’t or we lose the property completely. Sort of a pain, might do things a little differently next time.
I’ve done quite a few wholesales and I have never had a 30% rule on the Title Insurance issue. But of course an assignment fee is different than a double close. I usually do assignments and CAP them at $2997 because I do want repeat business but there is nothing illegal about getting more consideration.