Ok, I’m real new, so if the question sounds outta this world, that is why. Can I write a contract on an REO listed with a realtor and then sell it or assign it to my end buyer? :rolleyes
Yes you have both choices! With that said an assignment requires the payment of an assignment fee and your buyers lender will only loan funds against the contract they have assumed responsibility for by way of paying you your assignment fee. So if you say have a $100k contract and want a $5k assignment fee this is reasonable for someone to pay out of pocket, however if your buying the property for $100k and you want $40k profit your better off selling the property with a second contract and doing a back to back closing with transitional funding!
In the case of an assignment the lender will only loan xx percent of your actual contract so the assignment fee is an additional cost over and above the contract, except the lender will not recognize the fee or loan xx percent of the assignmnet fee amount. So anything over about 7% per 100k is better off being done as a second contract and back to back closing as most buyers don’t have the extra cash to put into a property for the assignment fee.
I hope this long explanation helps you as a new investor understand your options?
Thanks! :biggrin That was a BIG help!
Another question: I’m in Ohio, I have an investor list of 8 (just starting) who are ready to buy. I didn’t ask whether cash or financing; although I know that I have at least 1 cash buyer. They want to buy right away. Where do I get forms for an assignment and purchase contract - and how are they written?