New investor in Kankakee, Illinois need help!

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New investor in Kankakee, Illinois need help!

Kylen Rushbrook
Danforth, IL · Member since 2017 · 5 posts · 0 votes

Hello BP! I am fairly new to Real Estate investing and would really like some advice from people in my area (if there are any). 

Currently I have a fix and flip project (my first real estate investment) and while I'm waiting for it to be finished I'd like to take a shot at wholesaling. I have found a motivated seller and have agreed on a price. We do not have a contract signed yet though because I am having a hard time finding a title company that will handle assignments. Walked into one title company and they practically laughed at me and argued that it was illegal in Illinois or it simply wouldn't work. After reading through some discussions on here from members from the Chicago area I know for a fact it isn't illegal and this title company just doesn't understand the process. I spoke with a closing agent and explained it to her and she didn't see a problem with it but the general manager was the one who gave me a hard time. 

Anyways, I would like to know if anyone from the Kankakee County area knows of a title company that handles wholesaling assignments. If not, has anyone ran into this problem before? Is there a way to sit down and explain this to them? It's frustrating because the deal is good and I'll have no problem finding a buyer. I mainly want to use this first wholesale as a learning experience, I couldn't care less if I didn't make anything on it. But if no one handles assignments, what should I do? And no, I don't have the funds or credit to purchase the property myself so that's out of the question. Seller also doesn't want to sell on terms. 

The plan is to wholesale properties while my fix and flip projects are underway. This way I'm brining in cash when my properties are just sitting. Ultimately I want to have my first apartment complex by the end of this year and just build from there. 

I welcome constructive criticism, but please leave out your opinions of wholesaling assignments. 

Thanks! I hope to learn a lot from you guys/gals and I'm excited to be apart of this community!

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Scott Steffek
Flipper/Rehabber · Crown Point, IN · Member since 2009 · 482 posts · 216 votes
9y

Kylen,

Alexander is saying that you must have an attorney. I sell real estate all the time without one. But it's a good idea to have one, if you're not familiar with the process. I don't who the clown is, that told you you can't assign a contract, but I do it ALL the time. If the person who told you that, is the general manager of the title company, I'd run! The contract has to state that it's assignable and if it does, you can assign away. You don't need to do a double close, however if you don't, the person you're selling the property to, will know how much profit you're making. If you're ok with that, then just assign the contract. If you don't want him to know, then you'll have to do a double close and put up your money for the first close.  Since you don't have the money, then do an assignment fee ot transactional funding. For the assignment, you just have the buyer sign an assignment fee document and give that to the title company. Example: You buy it for $100k. You're selling it for $110k to your buyer. So the contract you assign says $100k. You fill out the assignment fee paperwork for your $10k, he signs it and you give it to the title company. Now you get your $10k at the close. If that won't work, you can use transactional funding. They put up the money for you on the first close and you pay them a fee for using it. You don't need good credit to use these companies. You just give them the title company name and they'll handle most of it. It's not real complicated once you understand it. PM me if you have questions.  Best of luck to you.

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  • Alexander B.
    Investor · Chicago, IL · Member since 2017 · 20 posts · 7 votes
    9y
    I posted this earlier today and it sounds like you dont have a real estate attorney. Very very important never i repeat never buy or sale real estate without an attorney. Make sure you find someone thats experienced. GET A ATTORNEY you cant get better advicw than that tbey will handle everything for you.
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  • Mindy JensenPro Member
    BiggerPockets Money Podcast Host · Longmont, CO · Member since 2014 · 7k+ posts · 10k+ votes
    9y

    @Kylen Rushbrook, is a double close an option?

    [email protected]Podcast Guest on Show #261
    BiggerPockets
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  • Kylen Rushbrook
    OP
    Danforth, IL · Member since 2017 · 5 posts · 0 votes
    9y

    @Mindy Jensen it is an option. There are no contracts signed yet. I was under the impression it was even more difficult to find a closing agent that'll do double closes?

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  • Scott Steffek
    Flipper/Rehabber · Crown Point, IN · Member since 2009 · 482 posts · 216 votes
    9y

    Kylen,

    Alexander is saying that you must have an attorney. I sell real estate all the time without one. But it's a good idea to have one, if you're not familiar with the process. I don't who the clown is, that told you you can't assign a contract, but I do it ALL the time. If the person who told you that, is the general manager of the title company, I'd run! The contract has to state that it's assignable and if it does, you can assign away. You don't need to do a double close, however if you don't, the person you're selling the property to, will know how much profit you're making. If you're ok with that, then just assign the contract. If you don't want him to know, then you'll have to do a double close and put up your money for the first close.  Since you don't have the money, then do an assignment fee ot transactional funding. For the assignment, you just have the buyer sign an assignment fee document and give that to the title company. Example: You buy it for $100k. You're selling it for $110k to your buyer. So the contract you assign says $100k. You fill out the assignment fee paperwork for your $10k, he signs it and you give it to the title company. Now you get your $10k at the close. If that won't work, you can use transactional funding. They put up the money for you on the first close and you pay them a fee for using it. You don't need good credit to use these companies. You just give them the title company name and they'll handle most of it. It's not real complicated once you understand it. PM me if you have questions.  Best of luck to you.

    1Reply
  • Kylen Rushbrook
    OP
    Danforth, IL · Member since 2017 · 5 posts · 0 votes
    9y

    @Scott Steffek I believe I have a solid set of contracts, ic done a lot of research on these. I am definitely having an attorney review them first. I wanted to find a closing agent that would do assigned contracts first so I don't waste my money. But I assume the attorney would be able to point me in the right direction, or maybe help me explain this to a title company.  And like I mentioned before, isn't the double close you're talking about actually a simultaneous closing? Or do I have that backwards? 

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  • Scott Steffek
    Flipper/Rehabber · Crown Point, IN · Member since 2009 · 482 posts · 216 votes
    9y

    Kylen,

    They're the same thing (double & simultaneous close). I've never actually run into a title company that won't accept an assigned contrast. Assigning a contract is nothing new. I would try Fidelity. I'm sure there's one in your area. Good luck.

    1Reply
  • Jay Fillmore
    Richton Park, IL · Member since 2016 · 2 posts · 0 votes
    7y

    Kylen, 

    I'm a wholesaler and fix & flipper in Kankakee county and I've done assignments here before. It's not required but it is very helpful if you have a real estate attorney who reviews your contracts and speaks with the title company on your behalf. I will rarely speak to a title company without my attorney being involved. It's just been easier and the attorney is worth the $500 or so you pay at closing. Usually the title company will be more open to listening to an attorney's words vs. mine and the attorney can possibly explain things in a way that makes more sense to the title company. Hope that helps!

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