Hey all! It’s been quite a while since I’ve been on, during my reiclub stint, I’ve flipped my first few properties successfully (thanks to you guys :)!)and I’m back with a question. I’m trying to acquire a property for wholesale purposes but it is listed. I know how to do a FSBO wholesale but I’m not sure on the procedure for a listed property as far as assigning the contract, math for realtor commisions and making sure that my profit is wrapped up in it at closing. Just a few details, the ARV for this property is about 150k(the value for this deal is really in the land) and I can get this property at 50k. I am trying to assign the contract for 10k. If anyone can get back with me ASAP on if and how I can do this deal I would be EXTREMELY GRATEFUL!!! Thanks and Happy Holidays!
If there is an agent involved, the agent will likely use the standard contract for the state, and the contract will almost certainly not be assignable.
Here in Texas, contracts are assignable unless stated otherwise. Standard REALTOR contracts are assignable and we do them quite often. Buyer agents often lets the seller know that they are assigning to avoid the seller being upset at close, but it’s not required.
Yes Dee, I know thats right as I’ve done them before with FSBO’s. I’m assuming I would just have the agent use the"and/or assigns" terminology in my contract and make sure they inform the seller. So pretty much, it’s just like any other wholesale transaction??
Is the property listed for 50k? I am interested in finding properties for wholesaling on the MLS. Can you give some insight?
Since they are all assignable, this means you do not have to put and/or assigns. Some people do, but it’s not necessary.
Guru, the property is listed for 55k but I’m going to offer 50k. I actually just found out how many desperate and motivated sellers there are in MLS! It’s the hidden goldmine. Talk to your agent and give her a specific criteria on what you want so that you can grab wholesale gains. (Example: you want homes older than 1965 but newer than 1930. Motivated/desperate sellers and purchase price from 25k to 55k.) Apparently this criteria may have worked for me and might for you as well.
Does the agent know that they are selling way below ARV? How did you come up with the ARV?
They do. Actually, that’s kind of part of my criteria. With this one deal, my agent straight up told me the ARV is 150k, most in land. The house is VERY unlivable so it would take about 35 - 40 in repairs. But looking at the numbers, whatever investor picks it up can do WONDERS with it and make a nice piece of change…whether he decides to knock this house down and build 2 houses on the land or fix it and sell it. I actually just got off the phone with my agent now, trying to indeed find out how difficult it would be to assign the contract since I’ve never done it with a listing before…