Agreement To Purchase VS Assignment Contract

Hello Laurice … when you’re “assigning” a contract to another investor, there will be TWO contracts involved … there will be the purchase contract between you and the seller AND the assignment contract between you and your end buyer (investor).

First and foremost you have to have an investor lined up to assign a property. When you have your investors you’ll need to know their investment criteria so you’ll know what type of properties to locate and write offers.

So, once you have your qualified investors, you’ll find a property that matches their needs and you’ll write a purchase contract so you can get the property under contract (this is where you’ll have your name along with “and or assigns.”

Once you have it under contract you have control of the property and nobody else can buy it. You’ll then take that purchase contract along with the assignment contract to your investor. The assignment contract will simply assign the contract over to your investor and the investor agrees to pay you an assignment fee.

I have questions to add to this.

Say you have the purchase contract

do you put it as "and/or assigns" or "and/or assignee(s)"

And what contingency do you put if none of the buyers on your list wants to buy it. How do you get out of it?

Yes, yes and yes.
always has exit plan out, protect yourself!!! Mistake happens it's not IF it's When, do your homework.

The first time I went with a Realtor, and wrote up the contract to purchase, he added that I can assign the property to that contract.
I also had contingencies, one being that I would have 30 days to get financing. It was not an REO.
I listed the property and did get several calls, at that point, if I found a buyer, I would have another contract for the assignment between that new buyer and myself.
If I didn't come up with the financing, then I could get out of the contract.
Turns out the brother decided not to sell, and I got my EM back.
But assignments are easy to do.
ALWAYS have a contingency to get out, if it doesn't go through.
ON FSBO, I ask them to give me 45-60 days to assign it, and if I can't it is void.
And that has worked okay with another one of mine.

Hey Sandiboots,

...so what exactly do you say when stating your contingency? Do you just say something like, "This is void if I cannot assign to a buyer within 60 days." If so, is there a contingency field on the Sales and Purchase Agreement contract somewhere? Or do you have to create a space for it?

Thanks,

Jerry

Sorry I don't check this site every day. But if you have the agent write up the contract, they put in the wording for ex...I have 30 days to get financing or the offer is void. Can't remember how Chad worded it, but I can dig it out and look.
If it is FSBO, I have written on these, that my offer is contingent upon me getting the financing in 45 days or whatever we agree on, or that I can assign it.
I actually had that for a contingency with one FSBO. Upon my financing, or being approved from my partner, or contingent on assigning it.

I have also had the offer, contingent on inspection which should be done in less than 10 days. And the inspection would have to be that the house may be unsafe structurally or has mold that can be fatal, or something like that. You can't just use the inspection for something minor.
Remember, with an REO property, these contingencies may not be accepted.
They are stricter on these things, as they don't want their time wasted, they want to get rid of the property, and want real buyers.

If you make your seller comfortable with you and are honest and upfront, assuring them that you are able to market their place and save them commission, they most times will like working with you.
I currently have a VERY MOTIVATED SELLER, just into Illinois area from Wisconsin, and he is willing to work with anyone to help him sell it asap.
If you know of anyone, I will give you part of my assignment pay.
But Simon I did PM you and did tell you I would help you, as I love doing assignments, they are easy. BUT you cannot do them with the REO. However, they are ways to do a double close with them, just isn't as easy from what I hear.
Hope this helps,
Sandi