Need Help For My First Deal(Please)

Hi Alonzo
Hello to you and congratulations for taking the first steps to get something done.

First question I have is: is the contract the seller sent you YOUR OWN contract or theirs? The reason I ask is because it should be your own and have YOUR contingencies in it.

You should have contingencies like:

1. The contract is contingent upon BUYER obtaining suitable financing.

2.The contract is contingent upon suitable home inspections (BUYER’s choice).

3.This contract is contingent on the fact that the seller understands they BUYER will be reselling or assigning the described property and or contract for a profit.

4.Contract is contingent upon buyer finding a suitable end buyer before the time allotted on this contract expires.

You have to have contingencies in your contract to protect yourself just incase you are not able to find your end buyer.

Right now that is the only contract you need until you find your end buyer. You may want to get them to sign a Notice of Option which you will take to the recorders office and pay them around $40 to record it for you. This is to keep another investor from going around your and trying to steal your deal. I personally don't use it everytime unless I don't feel to good about the peole I am dealing with.

Good luck!
Sissy

Thankyou sistreat!!! I know probably everyone gets nervous on their first deal but i am happy all you guys are here to help. Is there any way of seeing how these contracts look. would you have one that laying around to see how it looks filled out? i would greatly appreciate that. It is their contract and want 2000 to open escrow otherwise the contract can get cancelled. when i find the buyer would i have to sig another purchase agreement with him and another saying that i will assing it to him??

Here is the Verbiage Contained in a Assignment Of Contract document I've used several times in the past without a hitch. Hope this helps!

ASSIGNMENT OF CONTRACT

DATE

FOR $ _5,000.00_______,__five thousand dollars, no cents_________________________, the undersigned Assignor ("Assignor") hereby assigns, transfers and sets over to YOUR BUYER, ("Assignee") all rights, title and interest held by the Assignor in and to the following described contract:

A purchase contract for the property located at THE PURCHASE PROPERTY ADDRESS From Jack Doe and Mary Doe in the Amount of: $_____________________(Contract Purchase Price)

The Assignor warrants and represents that said contract is in full force and effect and is fully assignable.

The Assignee hereby assumes and agrees to perform all the remaining and executory obligations of the Assignor under the contract.

The Assignor warrants that the contract is without modification, and remains on the terms contained.

The Assignor further warrants that it has full right and authority to transfer said contract and that the contract rights herein transferred are free of lien, encumbrance or adverse claim.

This assignment shall be binding upon and inure to the benefit of the parties, their successors and assigns.

Signed this 11th Day of June 2009

____________________________________
Assignor's Signature
YOUR NAME, LLC or INC or TRUST if any

____________________________________
Assignee's Signature
BUYERS NAME

It sounds like you already received some great information and advice for your first deal. I hope it works out for you and you have all the information you need to move forward. You may want to take some notes and create a folder to keep your forms and information organized for future reference. I think a small notebook can help with all the details as you look at more and more deals. Please update us on your progress forward with this deal. Congratulations for taking action and good luck with your REI. Believe and Achieve! - Joe

Hi Alonzo,

Before you open escrow and deposit the $2000 earnest. Make sure the contract you use contains all of the contingencies "Sistreat" listed in the above post. Otherwise you stand to lose your earnest deposit if you are unable to find an end buyer to assign the contract to. Also, make absolutely certain that this is a property that you can move quickly. I have always either had a buyer lined up before I sign the contract and open escrow. Or, I set my closing date out to say, 45 days or so. To give me ample time to locate my buyer. If you are putting down an earnest deposit of $2000 your seller should not have a problem with this. In truth, I've put 60 days before. Even though it did not take me that long to find my buyer.

And no, you do not need to sign another purchase agreement with your buyer. All you need is an Assignment of Contract like the one in my previous post. Just have your closing agent at the title company look over the one that you use to make sure it contains all of the necessary disclosures. I've done several of these over the last 7 years in Phoenix AZ using the above posted document without any problems whatsoever. It may be different for your state.

As far as the earnest deposit. Just point that out to your buyer and include that on top off your assignment fee.

Hope this helps and Good Luck!

Larry

Almost forgot. Be sure to put "YOUR NAME/and or assigns" in the space for buyer, on the purchase and sale agreement you sign with the seller. Considering, they already know what your intentions are. Also, if you are doing an assignment. Some title companies will require that this be included. At least that's been my experience.

it looks to me like in order to get a seller to sign the initial contract (purchase agreement right?) there needs to be money put down (the earnest deposit) - is this always the case?

if so, what if you don't have the cash to put down on this earnest deposit?

thanks..

Hey Alonzo,

In order for the contract to be a legally binding agreement there must be some amount of earnest deposit. The majority of assignments I've executed have been CASH PURCHASES with a quick close because I already had my buyer lined up. This served as an incentive to the seller to do business with me. So my earnest deposit has rarely ever been more than $100. Especially if the investor I'm assigning the contract to is closing in 7-14 days. Which has been typical in my experience unless a title issue arises. Try and keep earnest deposits to a minimum whenever possible. And focus on finding properties you know that you can sell quickly for cash. I'm purchasing a bank REO right now. And I'm only putting down $500. And they approved it.

If you plan to move forward on the deal in question. And I only recommend you do if you know you can sell it. Don't give the earnest deposit check to the seller. Open escrow and deposit it with the title company. They(title company) will only hold it and not draw from it until closing.

Hope this helps and good luck on the deal if you decide to move forward. I know you can do it?

Larry

All that glitters is not gold! You know what I mean.

It is an agreement in which the two parties come to. So it can be 1 dollar! Your preference is to do the transaction with no money down. So you can offer with a contingency say you will give within a certain period in hopes of get the deposit from the new buyer in whih you can use as a earnest money down for the seller. Continued success..............Lubertha

Is this common practice for title companies? What I mean is, do all title companies hold the check w/ out cashing until closing?

If I am understanding right, the check is only cashed if I where to actually purchase said property myself? The check will be returned to me if deal doesn't reach closing (adhering to contingencies), right?

If deal goes to closing, can I use end-buyers money? If I where to use the copied check technique, gave the title company the copied check, then at closing had end-buyer write their own check, the title company would then tear up my copied check, correct?

If I'm off track here, I would really appreciate some guidance.

Thanks and good luck!
-Mike

I really appreciate you taking the time to help me!! I wanted to know if when my contracts are signed if i can run them by you or if i have a question about closing or what contract to use for x, if you will be able to help me? I am a quick learner so dont think I will be a hassle for a long time

I know when I get my experience I want to be the one to help others as well. I appreciate you help and undivided attention!!!

I have two questions: I lost my job. My wife is the onlyone working right now. I want to start my own business as an Investor. I have a friend that wants me to take over one of his houses, I told him i wantted to rent/lease it with the plan to buy it from him.

Right now he has a renter in it, w/a lease for one year that ends april 20010.

Question #1: Can I do anything right now with this comming deal?

Question 2: I read all about making deals w/no money down. But i dont now how to start. I have no cash and bad credit. Can some body tell me where to fing this deals and how to do it with no money down? Please Help. thanks
Nap.

hi there,

#1. You can still buy your friend property but keep the rental until his lease is up next April 2010. After the lease is up you can charge more rent if u want.

#2. If you advertised that you buy houses and someone calls u to talk to them and make a deal and you can buy it with no cash and credit if you take over his mortgage and keep on paying it and get a buyer and give you a down payment with option to buy. Lets say his mortgage is 800.00 and you can charge rent for 1200 dollars and that is your 400 dollars profit each month plus the down payment like $5,000 or $10,000. That info is in Dean's book.

Hope this helps

Warm regards,

Paul

Hi I am in need of help with the contract part of real estate this is holding me back. I see assignment contract is for assignment between the investor and the new buyer's and looks pretty straight forward. I hate being so black and white when it come's to the contracts. but I would like to know which contract to start with the ageement between the seller and the investor and if it would be possible to see one filled out. I apreciate any help!
Thank you

Hello Guys, Glad to be apart of Group, I've been reading alot of sound advise.
Hope I can get some of that. I have been trying to make contact with a realestate investor. He buys rehabbers,forecloseures, preforclosures.
My question is how do I present myself? I'm Starting out Birddogging to make some quick money. Any advise on how to break the Ice ? Also would like correspone with anyone out of Chicago Illinois. If not no problem God Bless!!
NEED HELP TAKING ACTION THANKS IN ADVANCE !!

Cozy Wynne: Future Realestate Investor

Hello Guys, Glad to be apart of Group, I've been reading alot of sound advise.
Hope I can get some of that. I have been trying to make contact with a realestate investor. He buys rehabbers,forecloseures, preforclosures.
My question is how do I present myself? I'm Starting out Birddogging to make some quick money. Any advise on how to break the Ice ? Also would like correspone with anyone out of Chicago Illinois. If not no problem God Bless!!
NEED HELP TAKING ACTION THANKS IN ADVANCE !!

Cozy Wynne: Future Realestate Investor

Finally, a question I can answer. I recommend you listen to the last conference call held on 6/18/09. Jeff and Dean talk about just that, how to break the ice when bird doggin. I dont want to say "hope this helps", because I know it will help. Hope you listen to this in its entirety. Now go and take action. God Bless

Here is the link for that call:
http://www.deangraziosi.com/content/conference-call-thursday-june-18-9pm...

Better to do something imperfectly than to do nothing perfectly

thanks Paul.

Congratulations on joining the greatest opportunity by far. My advice would be to present yourself upfront. Be totally honest to your needs from them. Honesty is always the best policy. Make sure he sees it as a win/win situation. Don't worry about the newness to the business. It's all about what's on the table. Much success to you........Lubertha

*Sorry* I posted in the wrong area. This has been re-posted in "FAQ: Answers To The Most Asked Questions - Start Here". Please respond there...
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Hi folks
I've just finished "Be a Real Estate Millionaire" & I've reviewed many of the posts here, but still have a few questions. Like others just getting started I don't have funds to spare & my credit isn't exactly an asset right now. Based on those factors using the assignment strategy to get started seems like my best option.

I understand the idea of assigning the deal to a buyer, what I don't know is whether I need to be at the closing with the seller & buyer (assignee) or whether the buyer pays the assignment fee at the time we sign the agreement--thereby relieving me of having to be at the closing & also ensuring the buyer will more than likely complete the deal as drawn up in the purchase agreement. Can someone clarify?

*Sorry* I posted in the wrong area. This has been re-posted in "FAQ: Answers To The Most Asked Questions - Start Here". Please respond there...
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It's me again. I wanted to split my questions to avoid a very long post

I've reviewed Dean's Agreement to Purchase form & am not quite certain what a couple of the paragraphs below mean. Some clarification would be a great help.

1)
“THIS AGREEMENT entered into on the _____ day of _________, 20____ by and
between,
______________________________ or his/her/their assignee(s), hereinafter
referred to as "Buyer", and __________________________________,
Hereinafter referred to as "Seller". “

==========================================
2)
“The Buyer agrees to pay ____Dollars ($_____________) as the down payment on the property. From this down payment shall be subtracted the Earnest Money previously paid, and the amount required for repairs agreed to be done by Seller.
In addition, the Buyer shall deposit monthly with an escrow agent
designated by the Buyer the amount necessary to make the payments to
the following mortgage and lien holders and none others. Included is
the mortgage to the Seller:
Holder Of Mortgage And Address
Amount DueMonthly PaymentYears RemainBalloon If AnyInterest
RateTax/Ins Account
A.
B.”
------------------

For item #1, is that sufficient for specifying that the contract could be assigned to a different buyer?

For item #2, I'm all confused! Is the down payment taken care of at closing? No where in that paragraph does it specify when the deposit is required. What's the reference to monthly payments? Especially the part that says "Included is the mortgage to the Seller".

The agreement doesn't have recommended statements I've read in previous post (cancellation & ability to aquire financing clauses), but I can figure out how to get those inserted.

Thanks for your help