Co-Wholesaling Mystery... what would you do?

Co-Wholesaling Mystery... what would you do?

Investor · Round Lake, IL · Member since 2015 · 41 posts · 17 votes

I am on a local wholesalers email list (I will call him Bob) and I assumed he had a contract direct with the seller so I signed a co-marketing agreement with him and blasted my email list. The real owner (also a local wholesaler that I will call Mike) called me up and asked why I am promoting his deal. Mike bought it out of probate a couple months ago and is on title. Mike is telling me that he is fine with paying me to find him a buyer but Bob is saying that he has a contract with Mike to promote his deal. Mike says he doesn't even know Bob. Another piece of info that is important in this mystery is that a novice investor (I will call him George) made an offer to Mike but I don't know any of the terms of the deal or if there was a formal deal. George and Bob are associated. George is Bob's  "student". So my assumption is that Bob taught George how to find deals and George got an option contract with Mike and it expired. Now George and Bob are still promoting the deal assuming that Mike will take a lower price than Mike is willing to take. My challenge is that Bob is now angry that I am talking to Mike and Mike is angry that people are promoting his deal without permission. Bob is the first one to contact me with this deal but Mike wants nothing to do with him. I had 2 different cash buyers look at the property in the last 24 hours and one of them is interested. If he makes an offer, should I send it to Bob or Mike? The other thing is that I have closed a deal with Bob and I trust him and do not want to go around him. He is telling me that he is 100% sure that he has a contract (thru George) with Mike and that any offers I receive need to go thru him and he will pay me the fee we agreed on (which is more than Mike is willing to pay me).

What would you do in this situation?

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Real Estate Broker · Indianapolis, IN · Member since 2014 · 3k+ posts · 2k+ votes
11y

Holy crap that was hard to follow.... 

If the owner of the property says ______ doesn't have a contract and your guy can't show you a signed contract.....  I think you have your answer. 

This sounds like too many people trying to get in on a deal. If I was in your position I would walk.

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  • Real Estate Broker · Indianapolis, IN · Member since 2014 · 3k+ posts · 2k+ votes
    11y

    Holy crap that was hard to follow.... 

    If the owner of the property says ______ doesn't have a contract and your guy can't show you a signed contract.....  I think you have your answer. 

    This sounds like too many people trying to get in on a deal. If I was in your position I would walk.

  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    11y

    Have Bob show you his contract.  If he can't, he's out.  If he's upset, tough crap, he doesn't have control of the property and is just lying to you.  I don't deal with liars.

  • Investor · Irvine, CA · Member since 2015 · 373 posts · 205 votes
    11y

    Sorry, I got lost on the 2nd Bob. A story like this almost needs a picture board, or at least a well formated piece with paragraphs, numbered lists with alpha sub lists.

    Imagine how much of a mystery man X is to all us who can't follow one very long paragraph.

  • Lender · Greater LA/Orange County area, CA · Member since 2012 · 3k+ posts · 3k+ votes
    11y
  • Investor · Round Lake, IL · Member since 2015 · 41 posts · 17 votes
    11y
  • Real Estate Broker · Indianapolis, IN · Member since 2014 · 3k+ posts · 2k+ votes
    11y

    You actually made a flow chart. You officially deserve an award for being a great sport. 

  • Investor · Irvine, CA · Member since 2015 · 373 posts · 205 votes
    11y
    Originally posted by @Nick Graff:

     Flow chart definitely helped! And I agree with @Ryan Dosseyyou're a good sport for reading the feedback, and then instead of getting pissy showed us all up by producing an awesome and easy to read explanation.

    Now to answer, if you have a buyer or are the buyer you need to respect the contract you signed with Bob, but you also need to communicate with Mike since he's ultimately the seller, and as I remember says he doesn't know Bob.

    I would put Mike in contact with Bob, and have them resolve whatever their issues might be before going under contract, or at least build in a contingency that the respective parties need to resolve issues of representation within X number of days.

    Isn't real estate fun!

  • Investor · Round Lake, IL · Member since 2015 · 41 posts · 17 votes
    11y

    Thank you all for the responses, help, and encouragement!

  • Investor · Round Lake, IL · Member since 2015 · 41 posts · 17 votes
    10y

    Update...

    I just wanted to let you know what happened in this transaction.

    1. 1. George had a written agreement with Mike that expired (I am guessing a 1 week option).
    2. 2. George told his mentor Bob about the deal and I am guessing that Bob didn't look at the option period. 
    3. 3. The option contract expired and George and Bob still kept promoting it. 
    4. 4. Mike decides that he is not willing to sell to any of us unless we pay more than the original option price.
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