Assignment istead of finder fee

A property that was in an auction was sold back to the bank, and since I got a buyer for it, I contacted the trustee to find out if I could get it. He said it will go back to auction, but I can buy from him the note. What does it give me and is it worth it?

Thanks, Lagy

I think you must be careful in the use of your words. Obviously, being a broker to the property is illegal if you don't have a license. Assigning isn't illegal but you must do it correctly. Just re-read the process of how assignments are completed and you will find your answers. Good luck.

Thanks for your response, and I'm not going to break the law here...

I still don't understand, if getting finder fee from the buyer is also ilegal.
And in case of assignment - if my buyer can join me when I go to see the property with the broker.
Can you please elaborate on this? Many thanks, Lagy

I don't use the word finder fee. I'm not representing either the buyer or seller nor am I selling a property. You are a consultant and is receiving a consulting fee for matching the 2 parties. Go here to for the agreement that I use http://www.biggerpockets.com/real-estate-forms.html

the basic rule is that you cannot do the jobs that a real estate agent could do under the law UNLESS you have an equitable or titlable interest in the property. Finder's fees are legal BUT they usually are paid for the introduction of a buyer and/or seller and are for the introduction ONLY. no additional work in regards to the property may be done. Different states have ruled in slightly different ways so please get an understanding of what is permitted in your state. Assignments are always legal as no one can usurp your right to assign your contract. Banks have policies regarding assignments but banks use assignments all the time. That doesn't make them illegal. As far as your Realtor saying that finder's fees are not allowed due to RESPA, that's hogwash. Her commission is stated on RESPA and you are merely a cost from her pocket , not the seller or buyer. I'm sure she pays taxes, agency rental, office supplies and other costs of doing business. You are merely one of those costs. You are not an additional cost to the buyer/seller. Now, we can get into a discussion of the amount and when it stops being a cost of business and starts to be an outright commission that is illegal, but that discussion should be with a real estate lawyer in your state. Get it in writing. Also, get any arrangement in writing with a real estate agent too so you may hold them accountable. Hope this helps.

Getting money from the realtor as part of their cost (PR, research, counseling etc.) and not as a commission (percentage of the deal) is a great idea. I can even do it with both sides
This has been very helpfull. Thanks so much for your time and advice.
Lagy

Let me clarify first...

A wholesaler is NOT a buyer but is simply a middleman in between the buyer and the seller. If you are dealing with a wholesaler chances are he has no intention of buying the property but is instead looking to wholesale it to his buy.

Assigning is absolutely Legal and the banks do it all the time. EX. Indymac Bank assigned all of their mortgage notes to One West bank when they bailed them out in 2008. The bailout money that the government supplied was the "Assignment Fee" that was paid to Indymac by One West. Assignment is NOT selling real estate but simply "assigning" your rights (contract) to a buyer for a fee. As Bill said make sure you use the correct contracts.

My suggestion would be to demand that the "wholesaler" provide you with a "proof of funds" before you go any further with them. Make sure the proof of funds (POF) is in their name. Make sure he is a true buyer before you go any further.

Hope this helps

You can get paid outside of closing when wholesaling a property that is listed. Simply have the buyer cut you a separate check for your fee. Your fee just cannot be listed on the HUD1, unless of course you get creative but that is another level of wholesaling...lol

Thanks Carol. I'll take yours and Bill's advice and try to get my money from both sides. That's legal and fun.

Lagy