Posted by JohnWe (NoCA) on January 19, 2000 at 10:15:46:
Yep, there’s another contract that you use. It’s really not that hard, just fill out the Assignment Contract, get the Assignor and the Seller to sign it, and you’re all done.
You should get to know a real estate publishing company in your area that prints up contracts like this. Either that, or pickup a course that has example contracts.
If you have the dough, I would suggest Bill Bronchick’s Nuts & Bolts of Real Estate. Not only is it good background information on real estate in general, but it includes all the real estate forms and contracts you would ever need.
If you just need an example contract however, check out Bill’s webpage at http://www.legalwiz.com, and click on Legal Forms. The contract you want is called Assignment of Purchase Contract.
I came across a two family home that is being sold below mkt value in the amount of $35,000. I negotiated withthe seller for $30,500 and it was accepted. The house needs minor work on the first floor, but the second floor needs no repairs. The dollar amount for repairs will be less than $2,000 if that. I want to assign my contract to another investor for $10,000. The house has been appraised for $60,000. If I was going to flip the contract, I would flip it for $15,000 but I don’t want to linger with this deal since I only have 30 days to sell. My question is how do I go about assigning my contract to another investor? Wouldn’t the seller be offended if he finds out that I am not the person he is dealing with, but another person? How can I structure this deal if I was to flip the contract and have a double closing? I know that I would have to find a title/escrow company to do the double. I am new at this and this is my first deal and the contract willbe finalized today! What is the process in assigning a contract to another investor? Do I have the investor sign the same contract or prepare a new contract with the investor? Your help is greatly needed.
Re: assignment vs flipping - Posted by JohnWe (NoCA)
Posted by JohnWe (NoCA) on January 18, 2000 at 19:42:56:
To flip it you need an assignment contract (it’s a new contract basically assigning your interest in the contract to the investor). Make sure your original purchase agreement is assignable. If you’re using a standard purchase agreement, then the part about it not being assignable must be crossed out, and the buyer should be you and/or assigns.
I don’t want to put limtations on you, but it wouldn’t be normal to flip this property for $15K. Your investor would have to be inexperienced. More likely, $3-5K, but if you can get $15K, great.
As a newbie, I think you should go this route just to get your feet wet, unless you’re in a hot market. Once again, don’t want to put thoughts into your head, but selling is definitely the hardest part. Selling to an investor is much easier, but you have to leave the lion’s share of the profit for the investor.
Re: assignment vs flipping - Posted by johnny recalde
Posted by johnny recalde on January 18, 2000 at 13:15:35:
I woul very much like to start investing money buying houses at prices that after being remodelled Iwill be able to sell and make a fear profit.
Thanks.
Posted by Mark-NC on January 18, 2000 at 11:05:12:
Ann,
You may have trouble assigning the contract for that much, it depends how savy the investor is. The fact that you don’t have a lot of time and you don’t know any investors interested in it at this time may put you in a little time crunch. You need to start calling or advertising for one and see what happens.
Another option would be to put an ad in the paper selling it with owner financing and sell the note at closing.
Example; Nice 2 family home only $60,000 needs a little TLC will sell with owner financing. EZ qualifying some credit required Only 5% down.
Heres how to structure the deal
sales price of $60,000
5% down of $3,000
80% 1st mtg of $48,000
15% second mtg of $9,000
Sell the first mtg to a note buyer for approx 95% $45,600
This with the down payment puts $48,600. on the table
Pay the original seller the $30,500
This leaves you a cash profit of $18,100.
Plus you will have a cash flow from the $9,000. second mortgage.
Thank you for your response to my question. What are the steps is assigning the contract to another investor. I have already signed a standard contract witht he seller and it does state that the contract can be assigned. So is there a different contract that I would use to assign to the investor? Assignment Steps Please.