Assignable purchase, Why some title company will not do it

[Gina Nicolas]

Hello everyone, I'm purchasing a house from a wholesaler. At first, he asked me to use his title company which I have refused. After many back and forth, he finally agreed for me to use my title company. The issue that I'm dealing now is, he told my title company that they will not have any contact with the owner of the house. Any contact will be with him only. He also told them that I will not have a purchase agreement until closing day. My title company replied, absolutely not. They must have contact with the owner in order for them to proceed. I'm so confused. I have 4 properties which I have purchased from realtors and FSBO but this is the first time I m getting one from a wholesaler. Why is the wholesaler does not want my title company to contact the owner? is that because he does not want the owner to know the price that I'm getting the house from him? Why his title company will agree to clear the title without contacting the owner of the house but mine would not do it? I thought all title companies do the same job and created equal. I am a new investor and I will really appreciate if someone can explain to me how assignable purchase works. I have read about the subject but dealing with it now, I still don't get how it works. I don't want to be loosing good deals just because of a lack of knowledge or because my title company does not want to do the transaction. Should I be looking for another title company that does that kind of transaction. I have used with my title company for years and I feel they always have my back. At this time, what should be my next step. I have so many questions. Anyone that knows about that kind of transaction or that subject, your input will be so valuable to me.

Thank you all

[Kyle J.]

Assuming that you are relating this information/story correctly, no title company could close this deal. 

Here’s how I interpret what you are saying....the wholesaler has a purchase agreement with the seller. He intends to assign this purchase agreement to you after marking up the original purchase price. The difference in the original purchase price and what you are buying it for will be his “wholesale fee”. However, he probably doesn’t want you to know what this “fee” is, so he’s reluctant to show you the original purchase agreement. Hence, why he has said the title company is not going to get it “until closing day”.

Again, if this is actually what he said, the deal will not close and you should walk away because you’re dealing with someone who doesn’t know what they’re doing and you’re just wasting your time.

First, no title company can close a transaction if the very first time they see the purchase agreement is the same day they’re supposed to close the deal. 

Second, you should never accept or agree to a purchase agreement (contract) being assigned to you if you have not read the terms of the contract that’s being assigned to you. Why would you? How do you know what you’re even agreeing to?

Some wholesalers will try to say they can’t show you the original purchase agreement, but that is complete BS. If it’s being assigned to you, you need to read it in its entirety BEFORE you agree to be bound by it. Anyone who tells you any different has no idea what they’re talking about. 

[David M.]

@Gina Nicolas

This just sounds like another shady deal.  You NEED to be allowed to see the contract.  You need to know what you are agreeing to.  For that matter, you need to know what you are buying, ie buying from the wholesaler.

Good luck.

[Gina Nicolas]

It looks like I  will have to sign an agreement between the two of us but original purchase agreement will not be available until closing day. This transaction really does not sound right to me. I  think , I m going to walk away.

Thank you all for your input