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Updated over 4 years ago,

Account Closed
  • Real Estate Agent
  • Los Angeles, CA
10
Votes |
39
Posts

My First Wholesale deal is getting COMPLICATED

Account Closed
  • Real Estate Agent
  • Los Angeles, CA
Posted

Ok let me start off by saying that I am NOT a real estate agent. This is my first wholesale deal and here's whats happening. 

I have a property under contract and I've JV'd with another investor who brought an End Buyer to the deal. We opened Escrow and the EDM has been deposited.


Now prior to signing anything I informed all parties that "all tenant affairs will need to be handled after closing by End Buyer". 

Three days after EDM was deposited, the End Buyer wanted to "see the property" I thought nothing of it. I was able to get him into the property without any problems. 

Now he's currently negotiating "cash 4 keys" with the tenants, which I don't mind but it goes against what I initial stated (all tenant affairs will need to be handled after closing). Tenants are more than happy to comply so I'm not too worried about the mishap. 

But now, its been DAYS and the escrow company has been asking for the End Buyers entity docs so that they can roll out the escrow instructions for closing and the End Buyer has been non responsive. When asked, he says things like "sorry I didn't see the email. sending them over today" but he never sends. 


So today I thought i'd give him a call and see exactly whats going on. I was very kind and understanding and truly just wanted to know exactly whats been holding him up. We were supposed to close today but because he has been unresponsive, thats not happening. 

He then proceeds to give me an excuse about "needing to figure out if he will use his current entity or a different one". I responded "ok well when do you think you'll finalize your decision" and he says "by the end of the day" 

Now, before I was able to get off of the phone he brought something new up. He mentions that he never received a "Transfer Disclosure Statement", "Tenant Estoppel Certificate" or a "Sellers Questionnaire". Now this is my first wholesale deal so I had no idea what he was talking about. He told me that he would send me blank versions of those docs. Cool.  


After I got off of the phone I relayed all of that information my escrow company and they told that the "TSD" etc docs were not necessary. 

So I sent him an email saying they weren't necessary for closing. 

THEN.. he sent a long reply about how every seller in california is legally required to submit that.

After some research, I realized he was correct. Now, at the end of his email he mentioned that a 9a report was also required. 

HERE'S THE THING 

He entered this agreement well aware that none of those documents (including the 9a report) were available or discussed. 

Getting the TDS and the other docs filled out and signed wont be too much of a problem, but as far as the 9A report goes, thats a whole process that could take weeks. 

Why would he enter into this agreement what all of this knowledge and then delay closing (intentionally or unintentionally) and then on the day that we were "initially" supposed to close, bring up the 9A report that we obviously don't have. 

I'm feeling right now that i've made some "rookie mistakes" and I'm owning that. But I zero idea how to move forward. 


Any advice/help would be GREATLY appreciated. 



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