Ok, I just finished listening to the free audio on wholesaling by Vena Cox, she says that when you get a property under contract to go ahead and get a inspection and a title report ordered as these cost are paid at closing and you the wholesaler will not have to pay for these, the investor you assign your deal to will pay for it at closing.
Say I assign my deal to the investor, the inspection comes with a major problem and the investor do not pursue this deal and it does not close, who is responsible for paying these fee’s then? Just because the investor backed out the deal doesnt mean these fee’s don’t have to be paid for…
just have payments of fees specified in the contract. (who pays what - no matter what) also, i believe you can concede to assignee, that they pay for title work/inspection etc. subject to everything coming up okay.
you as assignor, should not put anything under contract without verifying almost all of these things first, to avoid problems for yourself/your company. if you’re “big time”, and problems would be inconsequential, then i guess that doesn’t matter.
best thing, consult an attorney or have one one your team.
I agree in specifying it in the contract. Title fees usually don’t get paid til closing, but inspections are typically paid at the time of inspection. If you don’t end up assigning that deal, you will probably have to eat the inspection fee.
As an inspector, I have learned the hard way that I require payment at the time of inspection. There are too many things that can go wrong in a deal which would jeapordize getting paid for the inspection that had been performed. It’s too risky for the inspector to not get paid at the time of inspection. Besides, if an inspector knows that he won’t get paid til the deal closes, what’s to say that certain information might not make it’s way into the report. Example, if an inspector finds something in a house that could quite possibly be a deal breaker, how confident are that the inspector will put that information in there knowing that if the deal doesn’t go through he won’t get paid.
Food for thought…