Assigning question

It depends on what you are trying to do. If you are a bird dog, expect to get anywhere between $500 to $2k for a fee. If you are assigning your contract, as long as there is enough pie in the deal for your buyer, you can make anywhere from $2k up to $50k or more. The main thing is that you don't want to e greedy in you fee. Plus, if you set your fee too high, buyers won't bite, and you won't sell the deal. At that point, you will need to drop your fee. If your deal will allow let's say $15k for fee, try it. If the buyer or buyer(s) haggle with you on the fee, do it. Because even if you don't get the original price, you at least get something close to it. And, it's better to get something than nothing. Now, obviously if the deal is bigger, you can go for more.

One side note, one way to qualify a buyer is to require an up front non-refundable EM deposit. If you can get at least $1k to $2k out of him/her or them, that's great. If not, ask them for a proof of funds letter (bank statement, or ?). This way, you can keep the deposit even if the deal doesn't go through. If it does go through, make sure you take it off the rest of the fee you would get.

I hope this helps you. (:

This is one way you can do to get around this problem:

* Sign a Purchase agreement as an LLC. Then, assign either the "rights" of the LLC to the end buyer or sell the buyer the LLC for your assign fee, and have that buyer pay you outside of closing. Then, get the buyer to give you that down payment (up front) that you will need to give with the offer to the bank. Just remember to take the deposit off the total assign fee.

I hope this helps you. (:

Ok. It depends on the type of lender you are using. If it's a conventional lender, they will not go for assignment contracts. What he should do is sign his original purchase agreement as an LLC, sell you the "rights" to the LLC, and then he can collect his fee. At that point, he won't have to disclose to anyone except his tax advisor and pay taxes on that income from selling the LLC. Then, you would step in under the LLC and close on the property. If you have a Hard Money Lender or a HML (for short), they should have no problem with this, and they can do a double close with him and you.

There are ways deals can get done, you just need to be a little creative. I hope this also helps you. (:

Where is your buyer on this deal? I would get the buyer to get you an EM fee upfront, then sign contracts. If you don't have a buyer, tell the realtor to hold off a few days until you find one. If you can, I would move on to something else. I don't really like to deal with condos, because of all the fees and etc. Now, it's it's a smokin' deal and you have a buyer, go for it. (:

I really want to get involved in this. I live in a college town with alot of real estate for lease/rent and for sale. I'm not understanding a few things about the process as a whole. Here are my questions:

- Am I understanding correctly that assignment is strictly for cash buyers or people that are pre-qualified for a loan? And that the option to purchase agreement is for buyers who were turned down by conventional lending and now you are going to a mortgage broker to try and help them? I would like focus on Assignments if this is the case just b/c it seems alot cleaner and easier but is this realistic?

- Does a person start by finding buyers or sellers? I feel that I should be doing both simultaneously b/c if I don't have property on contract to show investors I feel they won't take me seriously. The flip side is if I go to a motivated seller and give him this idea have him sign a contract that says I have XX amount of days to find a buyer and I don't deliver doesn't this ruin my good name not only with the seller but with his network (i.e. Real Estate Agent and whoever else)which brings me to my next question.

- How does it all work....if for instance I call a for sale sign and they have real estate agent. Do I offer the assignment agreement throught their agent? Wouldn't the agent just hang up on me since this ties up the property for xx amount of days and he is unable to sell it? I feel I would be offending him/her by more or less saying "obviously your having trouble selling this property give me (the investor) a shot at it) and then if for some reason I don't deliver doesn't this just look bad? I mean why would that particular agent or agency ever want to try this again?

Thank you,

Mike

Matt, I love your explanation of the double close process, but there's one thing that I don't get, that is what about the funds needed to buy the actual property. For instance, you agree to buy the property for $60,000, put $6,000 down, but what about the cash for the $54000. Don't you need cash to cover that loan since you said you were paying cash for the property. What is transactional funding. And how did you come to the 10% down figure. Is that something that is negotiated in the deal or pretty much standard. Thanks to everyone, great post.

Deshone - Mr. Real Estate

Oh and the 10% down payment was just thrown in as an example.

I hope I didn't just make things more confusing.

Steve

Definitely get your buyer first. Don't worry about having property to show your buyer. You can run ghost ads online or in newspapers and such for a property (imaginary) that you have for sell. The ad should be written to attract the kind of buyers you want to work with. Then when they call you, you tell them that you just got another buyer for that house but that you are finding great deals all the time and you would be willing to find them one if they tell you what they want and need in a deal. You write down all their criteria such as: #'s of Bed, Bath, sqft., what neighborhoods, how much equity they want, etc.. You now have your first buyer on your "Buyer List". That's a term you will see a lot on here.

I have been interviewing buyers all day. I do it all the time regardless of whether or not I have anything for sell. The fact that your properties move quick is all the more reason that investor will want you finding them deals. The larger your buyer list the more options you have when you find a deal. If one says no you call the next on your list. This way you can act fast when opportunity knocks.

As far as agents go they vary but some are "investor friendly" and understand what you are doing. It's good to know a few. They all want that sale and commission though and are not going to turn away you and your client due to a bruised ego. They also are working for a seller that expects them to get it sold regardless of who wants to buy it. If that agent doesn't want to deal with you they probably won't survive in today's market very long.

Hope this helps
Steve

Working with realtor on some foreclosures, REO's..says lenders won't do the and/or assigns. He said he could do for me on retail properties, but not instituitions/lenders,etc...Can someone explain the idea of the LLC to me. I have couple of investors lined up and willing to pay me finder fee. Been very successful at finding good deals except they are tied to the lenders.HELP????

Hi I am new to the DG community and I had a few questions:

1. Is it possible to do assignment or birddog deals without being physically present or seeing a property? I will be relocating outside of the United States but still wanted to do business over the internet and phone.

2. Who are the contacts necessary to make an assignment deal happen? Do I need a lawyer or only a real estate agent?

Any answers to my questions would be greatly appreciated! Thanks!

The way the LLC deal works on an assignment is this. You create an LLC for the deal/property you want to purchase. You can at any time add others to your LLC as agents. You add your buyer to the LLC to strengthen it. You may even get your offer accepted without any buyer being on the llc. If not and the llc is essentially being "Approved" prior to acceptance then you find your buyer and add him/her to the llc. You then can get the seller to accept the offer from your llc. Afterwords you can remove yourself from the llc or outright sell the llc to your buyer in exchange for the fee (profit) you want to charge. You should do this prior to closing. You see the llc is the buyer not the individuals in it. When the deal closes escrow the buyer shows up to sign as owner or agent of the llc. When the buyer purchases the llc they are purchasing the assets and obligations of it, (meaning the property).

I hope this helped.
Steve

Hi dawiseone
Saw your post and I have a suggestion:
For one thing the agents are holding onto their possible commission from the sale, so if you let a seller know that the property listed with the agent could take a long time to sell and how they would be losing time and money whereas if they dropped the agent (saving them commission fees) you could sell it faster. Get it under contract and immediately market for a buyer. The gentleman with the 30,000. for a down payment is your new buyer now. The owners who have the financing are the ones you tell that their agents aren't moving as fast as you'd be able to. Right there you have a deal. Hope this helps.

I am not sure what you mean. Are you saying we should try to cut agents out of a deal? That seems sketchy to me. In this buyers market, it seems like a better plan to find buyers first. Qualify them. Determine what your buyer wants. Then, find a house fitting their desires, put it under contract, and sell it to them. This should work for investors and retail buyers alike. peace,

When we go in and have a seller deed their property to us and we do a sandwich lease, does the seller still have the right to claim the mortgage interest paid on the mortgage that is STILL in their name? How does that work?

I hope you are getting off to a smoking start on your REI. The question re: who gets to deduct the interest on LO's has been raised on this site. But basically the interest statement will be sent to the owner, but since we are the ones paying the mort payments, we are entitled to take the deduction. Regarding the tenant/buyers, they are technically just renting, so no decution for them. Exactly how we make the change from owners name to our name I not crystal clear on, but if you reach out to kareng, trustpoint, or pdqservicesinc Im sure they can help you with the details.

***But first of all, let me suggest you do a searh on assignments and you will probably find the answer, AND learn additional infor at rhe same time.

Best of luck to you

I was starting to understand the book(Profit From Real Estate Now) until I got to the section on assigning a deal and all the contracts. Found a property allready at a huge discount deal could probably talk them down. Thats not what I'm worried about. To get to my point: This property already has a real estate agent selling it. My concern is; Will the same technique work with an agent as it would with a FSBO. Also would she(that agent) be considered the title company that signs the contract?

Yes it will work, as long as everybody is on the same page, and you can get the property at a good discount. The trick is finding the RIGHT title company for your transactions. If you have Great American Title, Stewart Title, Chicago Title or Security Title in your area, you should be good to go. As long as you find a title company that can either handle simultaneous closings, double closings, courtesy closings (helpful for flipping bank reos) or anything like that, you're usually good to go.

I would check out videos from Stephanie Davis on Youtube ~ she has some very good tips and pointers on wholesaling. Also, Michael Jake has some good videos, too.
But, for free support, you can't get anywhere better than the DG website or family.

Why wouldn't they just sell it at auction (absolute) and turn it in to cash money within a couple weeks? A house has one price, what it's worth liquid on that day.

Newbie here ok heres my case...I have a buyer who wants 3/2 family I found him one but its bank owned. Originally I was thinking about assigning but the banks wants cash soooo...I was thinking about using the transitional funding to buy the property myself and then sell it to the buyer. The property is going for 49,000 but needs full rehab the estimate market value is 138,000. I was gonna use TF to purchase the property then sell it to the buyer for 70,000. Hoping to arrange it as a double closing? Can I use TF to do a double closing has any ever did that? Any suggestions what do you think does that sound right? HELP

way to buy REO's NMD. Sounds like you have a pretty good idea about the basics. Just make sure the bank has no seasoning, will go along with TF and also be sure to get you a title co/attorney that is familiar with back to back dry closings. Go luck and keep us informed.

ok I ran into a bit of a problem the buyer wont show the property without having proof of funds... I just just found out that you need an LLC in order to use TF. Even If I go and set up an LLC wont it take 25-30 days to process??? Which is way to long... I thought I would have access to use my LLC as soon as I set it up (newbie)...and to get a proof of funds letter I need to put down an LLC NAME on the form...does this mean my deal is a no-go??? Because its an REO and I cant assign it to the buyer I have to buy and sell with double close, right?

That is awesome. Sounds ,for lack of a better word, edgy, maybe stressfull. but it sounds cool. I will be trying to employ that technique.

Thanks

Hello all. I am new and yet to do a deal. I have a reverse of the cash verses finance question. I understand every buyers motivation will be different and dynamic, but why would anyone want a non-licensed person as myself to find an investor, also agree to be the person financing the sale? (I mean the seller) Especially if they are sick of renters. Isn't it the same thing? Aren't they needing to approve us for the credit of buyer/assignee? Whenever I feel like I have a handle on this, I get confused again. There are properties here that I would love to step out a bit on, but, I don't even live here and have no intention of using my credit or money. I also have a young friend who is moving to Denver and needs a lease option. Should I try to help by finding a property and an investor? Or leave it alone? You all are such wealth of information. Thanks, Debra

theres a package deal in my area;3 properties for $30k. 2 of the properties' FMV is a little greater than $30k, and the other one just a little over $15k. The properties need roughly $6k a piece in repairs which comes out to about $50k total. I've been lookin for a Hard Money Lender and I found one! He said that he wouldn't consider any properties under purchase price of $50k. All together the properties is $50k exactly what he said. Should I present this deal to him?

I would think that one reason for doing so is sheer desperation. If one is facing foreclosure, getting an offer on the house (a contract with "assigns" therein) MAY cause the bank or finance company from taking the house back so fast. I mean, if the mortgagee (bank, etc.) sees that someone else might be serious about the property enough to put in an offer to purchase, they might hold off on the foreclosure for awhile, as they really don't want to take the house back, anyway. They want to be paid, and they don't care by whom, necessarily.

The correct questions are how many people are really that desperate, and how many mortgagees are willing to hold off on the foreclosure.

"Rick in Amarillo," Real Estate Agent

I live in Texas can you assign a contract here.If so all I need to do is find a buyer, that will sale me there home for 1 price, lock it up on contract using just the assignment contract? Then finding a buyer at a price for a profit what contract do I ANOTHER ASSIGNMENT CONTRACT use for the new buyer and is this all i ned to do???

Please Help

Since I'm new to this investment business and not in position buy with cash the lease option to buy appears to be the best route,but how do I find title companies?

my question is after i have signed a purchase agreement with the seller and my intentions are to assign it to a new buyer, do i get (for profit) the difference of wat i assigned it for and/or the new buyers downpayment??

So in order to do this double closing, I would basically need a pre-approval letter from a lender right?

I can not just give a check for the full 60,000, then go to the other room to close with my buyer for the 80,000. I can place 60,000 in the bank for the title company to take out? (wow, would they risk trusting me to do that?)I would, but you know what I mean.

I will be asked for my bank information upfront days before closing right? The title company is the one that handles the money verification right? Is it maybe a bad idea since my buyer may reschedule the closing and now I am stuck with an overdrawn fee or worst... I know it may sound crazy, but just making sure I understand how this can work or should work.

Thanks,
First Time Investor

I'm new an trying hard to get started. What I'd like to know is exatly where I should focus my efforts, Starting the business process(getting registered), set up a web site, finding the deal, or finding the buyer(s)?

Any help is greatly appreciated.
Thanks