OfflineHello all, I went to a RE Lawyer today as I'm building my power team- I showed him my Assignment of Contract that I downloaded from DG site-
He told me that I needed to be a Licensed RE agent in California in order to be paid any monies by a seller-
Soo calling all California DGer's that have done Assignments in Calif. - can you help me? Maybe a different contract is needed?
HELP !
__________________
Thanks for the advice and forgive me I am just a rookie that is worried even more now.
Todd S
Whoever is telling you that an LO is like a mortgage has no clue what they're talking about. An LO is basically a rental agreement that gives the renter the first crack at buying the property by a future date with a predetermined price. How is renting your house out and giving someone first dibs on buying it breaking the Safe Mortgage Act? There is no transfer of ownership or a new mortgage being placed on it.
In addition, not all lawyers are created equal. You need to research. My first step would be to go to your local REIA and talk to investors in your area about your concerns. Then I would have one of them recommend a good attorney.
Finally, you can't let one idiot stop you from your dreams. If what they said was true then there would be NO investors in KY. I highly doubt that there are zero investors in KY.
KimmyJ
Press on...
Thanks for the info and I will be researching this more. Ill come back and update once I gather more details.
Todd S
There's a great post here that talks about interviewing an attorney by none other than KimmyJ. Kimmy, do you know off hand the title of that message? The info was so good I put it in my notes, but didn't reference the title of the message in my notes.
It's on the first page of this thread. It seems we veered off the initial subject, but eventually came back to it. LOL
KimmyJ
Press on...
Don't feel bad! We are all learning here and we are here to help one another out. You are doing good, but finding people that know the actual information out there like realtors and lawyers is one of the most challenging things I am finding myself. Keep up your good work! You'll do great, nothing to worry about, just a lot of people out there that are clueless to the concepts, attorney's are no exception! LOL
He may not even realize what a LO is!
If I choose to carry paper on anything whether its a house are a car, are a personal loan, This is my right.
Randy
www.adeptpropertiesllc.com
Good point.
Todd S
Wow, Seems like I have gotten responses from other area's in the USA-
I've heard from everybody but......
I'd like to hear from an DGer's/Investors in San Diego that have been doing the and/or assigns on some So. Cal deals that have been completed and I'd like to be referred to their lawyer. PM me PLEASE-
Kimmy if you HAVE completed an assignment I need to speak to you
Where are the Success Academy Coaches ? I wonder how they ring in on this subject??
I've been reading all of these responses & questions I have not done a deal yet but was thinking that assignments seem to be the easiest ones to start when you don't have any money nor credit. I'm from mid Florida on the east coast. It's just nice to see how everyone is out there to help each other out.
thanks, Bertha
Thank you
Hi Mike,
Am here from SD & a DG member too. I haven't found any agent yet since most of them back out esp. when i tell them that we will make 50-100 low offers a month.
Maybe Kimmy was right that we don't have to tell them that we need to assign it.
Have you tried doing assignments here in SD?
carmen
does everyone feel the need to disclose so much personal information to your realtors? All they need to know is your buying criteria and how you plan on paying for your purchase via POF. Period!!!
They don't need to know that you're a first time investor, they don't need to know that you are using transaction funding and they certainly don't need to that you plan reselling the property.
If you're in SD, you can't even do a traditional assignment of contract because the banks will not allow it. You have 4 options:
1. add "exact vesting to be determined at closing" Add your end buyer's name and POF while in escrow. Tell escrow that for tax purposes it is better that your business partner take title.
2. buy property in an LLC and sell the LLC to the end buyer and let them close. It costs about $100 to do this.
3. do a double closing only if the bank does not have a seasoning clause.
4. close in both your name and the end buyer's name and then quit claim the deed to your end buyer after closing.
This is not rocket science. You are letting minute things stand in your way of success. What is the worse possible case scenario? You lock up a property and wholesale it or you can't find an end buyer, so you use your inspection clause to get out of the contract and get your EMD returned. You are no better off than when you started except you took action and did something. Sorry to be so matter of fact, but like Nike says JUST DO IT!
KimmyJ
JUST DO IT!
www.tagteampropertiesllc.com
Soooo.Ms Kimmy.. let me make sure I have this straight here>
1)Instead of my name & and/ or Assigns in the buyers place your saying put>>
Joe Blow "exact vesting to be determined at closing" ?? Is that what you are saying?
2)I checked on legal Zoom and it looked like it costs approx. $500 to form a LLC? Where are you getting the $100 ?? Help
3)How do I know if the bank has a "seasoning clause"
4)Understand about the Quit Claim- But once my buyers list is started and working I'm unclear how I would put the buyers name also if I don't even know who's buying or who will step up to buy- so that bring to me another thought-when I start interviewing Investers/Buyers --Do I ask them straight up for Proof of Funds?(that's not covered in the book either.....
Anyhowz not trying to bug ya-just looking for valid information from someone that's making this all work
According to the book, "California Real Estate Laws" by William H. Pivar and William Bruss 2005 assigments in California are legal. It is up to the banks to accept them. This is why people think it is "illegal." My real estate agent said it is very difficult to assign with REO deals, however, some DG investors have been able to do it. So again, it is up to the bank. The banks just don't want people to assign it back to the original owners.
Pivar and Bruss write:
Assigment of Contract pg 151 - "In an assignment of contract the assignor transfers his or her interest in the contract to a third-person assignee. In an assignment the assignee becomes primarily liable for the contract, while the assignor retains secondary liablity should the assignee default on required performance."
Stephanie
Im enjoying this
Good to see you posting Kimmy 
your too much.
Soooo.Ms Kimmy.. let me make sure I have this straight here>
1)Instead of my name & and/ or Assigns in the buyers place your saying put>>
Joe Blow "exact vesting to be determined at closing" ?? Is that what you are saying?
YES. IF THE BANK OMITS THE EXACT VESTING IN THE ADDENDUM, WHICH THEY PROBABLY WILL. JUST HAVE YOUR AGENT ADD IT BACK IN. IF THE AGENT WANTS TO KNOW WHY YOU NEED IT IN THERE YOU JUST TELL THEM THAT YOU ARE NOT SURE WHICH ONE OF YOUR BUSINESS ENTITIES YOU'RE GOING TO HAVE TAKE TITLE TO IT BECAUSE YOU HAVEN'T DECIDED WHAT YOU'RE GOING TO DO WITH THE PROPERTY YET. YOU NEED TO CONFER WITH BUSINESS PARTNER FIRST.
2)I checked on legal Zoom and it looked like it costs approx. $500 to form a LLC? Where are you getting the $100 ?? Help
WHERE WERE YOU LOOKING ON LEGAL ZOOM? THEIR ECONOMY PACKAGE IS $149 PLUS FILING FEES. OR YOU CAN TRY WWW.AMERILAWYER.COM WAY CHEAPER. OR YOU CAN DO IT YOURSELF LIKE I DID. IT IS A 1 PAGE DOCUMENT CALLED ARTICLES OF INCORPORATION ($70) AND THEN A STATEMENT OF INFORMATION ($20). GOOGLE "CALIFORNIA BUSINESS PORTAL" FOR INFORMATION AND FORMS. ALSO, MAKE SURE YOU DO A NAME AVAILABILITY CHECK BEFORE PICKING YOUR NAME. THIS CAN BE DONE THROUGH THE PORTAL. BE AWARE THAT IF YOU FILE FOR AN LLC, YOU WILL NEED TO PAY AN $800 FRANCHISE TAX FEE BY THE 15TH DAY OF THE 4TH MONTH AFTER FILING. YOU ARE NOT GOING TO WORRY ABOUT THAT BECAUSE YOUR END BUYER WILL BE RESPONSIBLE ONCE HE PURCHASES THE LLC. HOWEVER, MY SUGGESTION IS THAT YOU RESERVE A NAME FOR 60 DAYS FOR $10. IF YOU GET A DEAL WITHIN THAT TIME FRAME THEN YOU CAN CONTINUE WITH THE LLC FORMS I MENTIONED ABOVE. NOW YOU'RE ONLY OUT $10 AND YOU DON'T HAVE TO WORRY ABOUT A FRANCHISE TAX FEE.
3)How do I know if the bank has a "seasoning clause"
AFTER YOUR OFFER IS ACCEPTED THEY WILL SEND YOU AN ADDENDUM. READ IT VERY CAREFULLY. THEY'RE GOING TO HAVE A BUNCH OF GUIDELINES WITH SEASONING RULES, ETC. YOU CAN TRY TO HAVE YOUR AGENT CROSS OUT THOSE ITEMS, BUT MOST LIKELY THE BANKS WILL NOT NIX THEIR TERMS.
4)Understand about the Quit Claim- But once my buyers list is started and working I'm unclear how I would put the buyers name also if I don't even know who's buying or who will step up to buy- so that bring to me another thought-when I start interviewing Investers/Buyers --Do I ask them straight up for Proof of Funds?
YES, YOU ALWAYS QUALIFY YOUR BUYERS WITH A POF. YOU DON'T WANT TO WASTE YOUR TIME WITH SOMEONE WHO HAS NO FUNDS. WHEN YOU DO FIND A DEAL, YOU HAVE THE END BUYER GIVE YOU A $2500 NON-REFUNDABLE DEPOSIT. THIS WAY IF HE BACKS OUT AT THE LAST MINUTE YOU RECOUPED YOUR EMD.
IN REGARDS TO THE QUIT CLAIM STRATEGY, YOU'RE GOING TO TELL ESCROW SOME TIME BEFORE CLOSING THAT YOU WANT TO ADD YOUR BUSINESS PARTNER TO TITLE. YOU WILL NOT BE TAKING YOUR NAME OFF TITLE. THIS WILL BE KEY IN GETTING YOUR END BUYER'S NAME ADDED.
(that's not covered in the book either.....
Anyhowz not trying to bug ya-just looking for valid information from someone that's making this all work
Hope this helps...
KimmyJ
Press on...
Thanks!
I agree that you should find another attorney. Right now it's true- not everyone understands LO's, However, to simply tell you that it can't be legal or can't be done is an awful untruth. People lease things all the time, refrigerators from stores, cars from car lots (things that are a common occurrance)right? Don't let that person steal your Joy, find someone that actually works with many investors. It can be done. Do Not let his/her fear of something different stop YOU.
Tori
Hi All
I'm new to all this so correct me if I'm wrong. What Mackelchea is saying is that he was told you need to be a real estate agent to collect monies from a seller, but on a contract assignment aren't you being paid by the buyer?