Paying a Realtor in a Wholesale Assignment

Can you assign a 'confirmation of sale'? This is what is used when purchasing a property at a sheriffs sale. There is no 'contract'.

That's a good question. For the one property I bought at a sheriff's sale, the clerk asked who's name would be on the deed and just jotted it down for reference (they spelled it wrong, as a matter of fact, which had to be corrected later with a different deed). I wonder if, at the time of the sale, you could put your name and/or assigns. I'm guessing they wouldn't really care as long as SOMEONE paid for the property. I'll be curious to hear what the coach says. (This might need to be in a different thread)

Rina

In a double closing, would the realtor only be representing the FIRST transaction, and you would basically be a FSBO for the second? And in an assignment there is really only one buyer, so the realtor shouldn't have a problem with it... Am I understanding this right?

Rina

Rina, that would be my understanding, as well, but would like to hear from the coach.
I did a double closing one time where there was not a realtor involved, but had there been, I believe since there are 2 separate contracts, and the realtor only had an agreement with the first seller, they would not have an agreement with you, the second seller, to earn a fee. (thinking on paper, here)
Waiting to hear from coach....

The Realtor is getting paid by the original seller. Their responsibilites would legaly end at the first sale. They do not have a listing contract with you. I would expect an Agent to assist with the whole transaction, because he/she is representing you as a client. The Agent's Broker may have some say in what they will allow the Agent to do. You would probably want to establish this before getting into the transaction.

Al

The realtor does not receive a double comission?

The realtor will only get paid on the orginal sale of the property based on the contract that you and the original seller agree on. The seller pays 6% it can go all to one agent or split between 2 agents, they typically don't make a comission on the contract you have with the end buyer.

Thank you for your response. At the next sheriff's sale I attend I will ask a bank rep (if present), and I will also ask the clerk of courts (or whomever they refer me too) and the sheriff. I think there may be more flexibility in an auction situation since everything is done so "informally" here. I'm curious to see what we can make happen.

Thanks again,

Rina

that was a lot to take in.
I'm just getting started in Wholesaling and i hooked up with a realtor who is willing to hook me up with properties and getting information for me.we haven't gone through any of the specifics yet but she is going to want to get payed,What kind of deal can i precent to her?

Your Realtor will get paid by the seller on the deal. The Realtor is representing the the buyer on the contract. She will get her commission as the buyers representitive.

Al

that clears up a lot thank you very much

I have a deal for 35% below the market price, i took out the damages and fixer upper money, and offered the owner that price,they declined my offer but said were interested and would give me a follow-up. assigning the deal over to a investor, would i do it at the base price i gave the owner or would i raise the price to receive the difference in both costings to receive my earnings?

In a double closing you would purchase for one price then hours later you would close for a higher price that you had contracted. In an assignment of contract the easiest way to get the assignment to go through would be to get paid a fee when you assign or sell the contract to the new buyer.

When doing an assignment of contract a common fee that can be charged is $1,000 per every $10,000 in equity that you provide for the new buyer. In the example of the property that had 35% equity suppose that was $35,000 in equity they could charge, reasonably, $3,500 for the fee.

Wow!? Thats a BIG Difference from where my local market is, thats...LOW!? If i'm offering a Rehabber, lets just say; An ALL CASH Deal with a Profit of $40,000-$50,000 80%-90% of the WHOLESALERS(including myself) are recieving AT LEAST:$5,000-$10,000 for that type of ASSIGNMENT. Most Investors DO NOT care what your making as long as the DEAL Works For THEM

I finaly got up the nerv to walk in a realtor's office and tell them what i wanted to do, i walked out with leads to 4 properties.

Hello my fellow investors my name is orlando ,this is my frist time posting a comment. I finished reading deans book and feel motivated. I keep hearing alot about contract assignments, and its exactly what i need to do cause i have no money to start.I want to get out there and find deals to lock up but i have just one problem,iam not sure i know how to use an assignment contract and also where to get one. Can someone please help me with this.thanks

As far as a contract or Agreement of Purchase you could use one from this site, one from a realtor but you will need clauses in it to pertect your self. such as (and or/assign) wich tells the seller you may assign the contract over to someone else to buy the property.and a Financial clause wich will protect you if you can not come up with the money to buy the property.
the assignment of contract is just one page that assigns the contract that you have with the seller to a third part, your end buyer,weather it be a nother investor or rehabber. this can be found on this site.(Student resource and docs) I hope this has helped you.

I just gonna throw another question out there. If you was to provide the endbuyer for a deal that you found threw a Realtor can you find a backdoor way to get compensated e.g. like if you have a website and you take the property that the seller is selling for the seller and you advertise that property on your website, you provide the buyer and the Realtor gives you llke a marketing fee for advertising it on your website but the real reason is because you provided the buyer. That was quoted by another guru, and you will need the appropriate contract and of course a website.

With that I remain!

if you find a property through a realtor and you find an endbuyer you get compansated from the end buyer, one of 2 ways, you can just get a small finders fee from the buyer for the deal on to him or you can assign it to a end buyer, put the property under contract in your name, using and/or assign after your name and you assign the contract to a buyer who pays you a fee for your time and effert, and the seller takes care of the realtor, I hope that helps Ted.

once you have a property under contract you can market it anyway you want.
if you have a website put it on there. you can use news papers,flyers, bandit signs. let every one you know what your doing.

A Great Realtor has everything figured out when it comes to structuring the deal and obtaining compensation from my experience. Love assignments. Great discussion.

There have been times when I have been compensated by both parties for putting the deal together. How many times can you go to the same well?

The seller 9 out of 10 times pays the commission on the deal and realtors split. If you assign the deal to someone else the realtor still only gets paid once. Unless you have structured something different.As long as you make you deal transparent so your realtor understands you will have no problem. Its easier to structure your compensation and deals in the beginning then to try and do it at the end. Explain to your realtor when preparing the offer what and or assigns means.You will be assigning this deal to someone else.
In todays market most realtor would be happy getting paid once.

Adam

they get a percentage of what the house sells for, a standard rate is 6% usually split between the buyer and seller agents but if there is only one agent representing both parties then the agent gets the full commission. If you purchase a home for 100,000 then they would get 6% of that ( the purchase price). Percentages start around 5% and go up but it's usuallu what the seller agrees on. If you're working with a fsbo you could always add in a percentage for your realtor (usually 3%) and some fsbo owners will already have an agreement for that in thier property discription. I have seen a few that have said offering 3% to buyers agent. I hope this helps you out.

Reading Dean G. Book it was recommended with starting out that i offer a agent 1% of what i assume the profit from a assignment deal. But the agents that i have contacted say that there is a pre-determine commission and how it will be distributed in according to the state Licensing laws. So there seem to be a problem with the 1% suggestion from Dean G. Book. So how do i explain to these agents about the 1% when their argument is that they are govern by state law. I have been going backwards and forwards with real estate agents about this said issue. So can someone explain to me so that i can explain to them how i can best present it to these agents about the 1% Dean G. suggests in his book can work???

Secondly the realtors in this state are required to use state preformed contracts that doesn't have and or assigned in them. So these agents wants to know how can they work with us under these regulations???

Thanks In Advance Everyone!
Pharaoh & Tony
OsirisLLC

First when you speak of regulations I would question the regulations. Have you actually seen the regulations? I would also suspect that the Realtor(s) can not produce them as well.

Second. When it comes to contracts you can add or subtract anything you would like. If the sellers agree with the new changes the contract is good.

Third. When it comes to paying the Realtor the idea is to pay the Realtor above the normal pay not cut their pay. Keep in mind that if you in your job where approached by your boss who offered to pay you far less to do the same amount of work you are use to you would not be happy at all. However, if your boss approached you and said they would pay you a little more if you worked just a little harder you would probably be happy and obliged to work a little harder.

What state are you talking about? (You may want to fill out some information about yourself on your profile)

I believe what Dean mentions in his book, is offering a 1% commission to the seller agent and not use an agent of your own (i.e. no buyer's agent); this will give the seller's agent a 1% above their 3%, so they would get 4% total- a win for them, a win for you.

I have been involved in real estate transactions where my agent has reduced her % fee; agents can do this, but they still have to pay their brokeraage firm, so they have to make sure they don't reduce their fee too much to make sure that their brokerage fee doesn't come out of their own pocket. Also, sometimes agents will split the discount with the buyer's agent; it's stated in the 'hidden' notes on the listings on the MLS, so buyers' agents are aware of it; keep in mind, that when there is a discount offered to buyers agents, they may show other properties to their clients that offer the 3% commission, plus other incentives...

Wishing you success,

Valerie

get away with NOT having the "and/or assigns" in the contract & just do a double closing? I KNOW the banks around here would reject that clause for sure.Around here I know I could sell any property that's decent as long as it's in a good area of town & at the right price.Let me know..Thanks....!

Reality is that contracts are assignable without and/or assigns unless the contract has a non-assignability clause. Keeping this in mind most closing companies do not understand this and they will require you to have and/or assigns in the contract.

You may be able to find a company that does not require and/or assigns and will still let you assign the contract. The banks will find out there is an assignment at closing and they may still back out.