What does a wholesaling Memorandum Protect

Question

What are all the protections for the wholesaler using a Memorandum? What should I state in the contract in order to protect me from the seller canceling the purchase and sale agreement?

Jay Hinrichs · Answer

we buy ugly houses has gotten hammered for allowing their franchisee's to record these and they no longer allow them.. U run the very real risk of getting sued for slander of title.

Joseph Hernandez · Answer

@JayHinrichs. I don't know what slander of title means, so I Googled it. It says, "In law, slander of title is normally a claim involving real estate in which one entity publishes a false statement that disparages or clouds another." So, inserting a memorandum clause can get me sued?

So, what false statement am I making if I simply want to protect myself from either the seller accepting my offer and later accepts another offer or from an investor going behind my back? You mentioned that is rarely happens, but it happened to me and I only flipped a few houses.

This doesn't seem right. All I'm trying to do is protect myself. I'm not stating any false information, but I can get sued? This doesn't seem righ

Joseph Hernandez · Answer

@Jay Hinrichs. Suing will be a huge hassle. I flipped a house with an attorney because he took the profits and ran. There's a lot of work involved. Plus, I virtual wholesale. I won't travel back and forth numerous times in different states. It's hard to believe that simply pay me my wholesaling fee if the seller or end buyer tries to screw me. Title has both the Purchase and Sale Agreement and the Assignment of Contract.

Tom Gimer · Answer

I'm with @Jay Hinrichs... in a typical buy/sell if the seller flakes and tries to get more $ I would have no problem recording an affidavit of interest or memorandum. However if I was wholesaling the deal and did not intend to (or have the ability to) close, that's a big mess waiting to happen. I would send a demand letter on attorney letterhead advising of the intent to enforce the deal and depending on the response perhaps nothing more.

Joseph Hernandez · Answer

@Jay Hinrichs. What do you recommend I do to protect myself from end buyer investors from stealing my wholesale deal after I have a valid Purchase and Sale agreement with the seller? Thanks Jay for your help.

What does a wholesaling Memorandum Protect

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