Wholesale complication

[Ronnie Sparrow]

I have my first wholesale deal under contract now. My fee is $5,000. After marketing this property for about one week I now have a buyer. The problem is that one of the potential buyers actually called the seller and made an offer behind my back. This guy tried to,steal the deal from me. Fortunately the seller is staying with me because of the rapport I have built with her. Has anyone ever encountered this? And since this is my first wholesale deal is this going to be the norm or is this the exception to the rule? Your thoughts!

[Ned Carey]

I don't know that I can add much to what has been said but I find this both interesting and an area I have had experience.

No it is not common

Interfering with an existing contract is a tort which you can sue for. I wouldn't hesitate to throw that threat at anyone who tried to interfere with my contract.

The seller is legally obligated to the first contract but that won't stop a second buyer from closing. It leaves you with a legal claim against the seller.

@Christina R. you can record a contract of memorandum of contract in MD. However Baltimore city requires you to pay transfer taxes to record a contract and refuses to record memorandums. The work around is to call it something else.

I used a memorandum of contract to save my most profitable deal. I made over $200K so it was worth the trouble. It stopped the second title company dead in their tracks.

Another option is a specific performance lawsuit. This creates a lis Pendens which also will stop any title company or allow the deal to be reversed. I filed this for a couple of hundred dollars which saved perhaps my second most profitable deal. In this case an agent was knowingly trying to go around my contract. He could have lost his license for that.

The problem is you are not likely to take any of these steps unless you know about the other deal.

- Ned