I am a new wholesaler and has never worked with a title company before and I see in a number of posts that once you get the seller under contract you take that contract to a title company and start the process.
My first question is: Is there a form that you fill out or a fee that you have to pay to get the process started - AND exactly what process am I getting started?
My second question is: when i assign the contract to a new buyer - is there a fee involved when I take this assignment form and purchase contract to the title company and earnest money deposit check to the title company?
My third question is: What if the deal falls apart before closing? Is there a cancellation fee owed to the title company and who pays that?
My fourth question is: If my closing date is supposed to be on the 30th but I find a cash buyer who I assign the contract to on the 5th do they have to wait until the 30th to close.
My 5th question is: What if the assigned buyer and seller doesnt close the deal - do I still get my earnest money if its non refundable - I know I wouldnt get the assignment fee right?
First, many if not most title companies also act as the escrow agent.
Second, not all title/escrow companies will handle a double close that is required when wholesaling. You should find out which ones will do a double close (go there prepared to explain what it is). Only use these.
Third, I only start the title work (which will cost you if you cancel) after the contingencies have been waived. If you have inspection contingencies or “partner” approval contingencies - wait until these are satisfied and then go to the title company to get the ball rolling. Ask them about costs in the event the deal falls through.
I do not believe there are fees to begin the process with the title company - but you should ask them.
If you have a cash buyer who wants to close earlier, you have to close with your seller on that same day if you want to be able to transfer the title into your end buyer’s name. You would need to check with your seller to see if they can close earlier.
If you have a non-refundable earnest money deposit and you or your end buyer kills the deal for anything other than one of your written contingencies - you do not get your earnest money back.