The role of Title Companies and Real Estate Attorney in Wholesale

[Tim Ivory]

Hi. I've spent all day speaking with many title companies and attorneys and am now a little confused about the distinctions I need to make in finding one that is good for wholesaling or using other types of creative financing. I hear all the time I need to find real estate investor friendly title companies and attorneys, but what does this really mean?

For title companies, do I just need to make sure they would allow double closings? Do they play any other role that is specific to closing wholesales or other creative financing? When I spoke to Colonial title they said they would be able to use the ultimate buyers funds to make the purchase I have under contract and I keep the difference. What if I need to do subject to's for instance, is there any reason any title company, investor friendly or not, wouldn't allow this?

For real estate attorneys, do I just need to make sure they can write up a contract that is assignable to allow wholesales and that they can enable any creative financing options I would need in the contract -- lease options, subject to's, owner financing?

Thanks in advance and I hope I can get some answers before, nearly all, the attorneys call me back tomorrow -- I spoke to all there secretaries, lol... I'm just starting to invest in real estate and I could really use a bit of help to get started. Cheers!

[Sekelle O.]

When I do a wholesale deal, I have 2 contracts: the purchase contract and the assignment contract. When the end buyer signs the assignment contract, I collect a check for my fee, made out to the title company, who holds it in escrow. I also collect a check reimbursing me for the earnest money deposit if I already paid it, made out to me.

The title company gets both contracts. When the buyer closes on the purchase contract, the title company releases the assignment fee to me after the new deed has been recorded.

If my fee has to go on the HUD1, I have the title company put my business name on it since my contracts are all either in my personal name or an LLC created for that specific transaction. Or I get paid outside of closing.