Binding contracts

[Account Closed]

If I am making an offer on a property do I need to pay a lawyer to prepare a binding contract or can I legally create my own? How does this process work?

P.S I do not plan on closing. My goal is to wholesale the property.

Thank you ahead of time for any input

-Rob Z

[Josh C.]

No, a lawyer doesn't have to draft it to be binding. However, you are 100% responsible for your contracts. They should be clear and fair to all parties. It's important your contract represents what you are ultimately trying to accomplish, i.e. dont say you are going to do something (like buy their house) when you have no intension of doing so.

Good luck.

[Account Closed]

@Josh C.

Thanks, Josh. I called a title company and they had told me it is illegal to write your own contracts and present them to the seller. Maybe he misunderstood what I'm trying to accomplish.. Why do you think he would say this?

[David Rundle]

Does your state real estate commission have a standard real estate contract? That'd be a good start.

[Account Closed]

David Rundle
I'm not sure. How would I find that out?
Are either of you familiar with the wholesaling contracts under fileplace above? They have a purchase and sale contract and also an assignment agreement. They seem legit to me. You're more familiar with contracts then I am though. What do you think?

[David Rundle]

@Account Closed

It sounds like you might benefit from finding an expert wholesaler in your area and offering to split the profits from this deal in return for using his contract.

As with anything in life, no risk no reward. You can either A) Go to a lawyer and seal up a contract ($$$) B) Offer to split the deal with an expert willing to share his contract ($$) or C) Take the risk, print off a contract from google and roll with that (no cost, larger risk, larger reward).

You're not going to find a clear-cut answer here, we're not lawyers and I'm not familiar with Illinois.

If you're asking what would I do? I'm a large risk taker and I like my money for myself.

[Account Closed]

David Rundle
The lower I can get my expenses the better off. I like the idea of making up my own contract as well. Thanks for your opinion and advice. One more question if you don't mind- what is the potential risk beside losing the deal?

[Wayne Brooks]

Robert, just to be honest.....from your questions, it is apparent that the Last thing you should do is go with your own contract, or one you just found somewhere. You don't understand the implications of the contract, and the different scenarios that could occur. Find someone to work with, and learn from. You can't learn everything here. As to of your state has a standard realtor contract, yes it does. Google.

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Wayne Brooks
Honesty is what I'm looking for so thank you.
The way I look at it I could spend $250-$500 on a lawyer to look over every one of my $10 binding contracts and potentially lose that money and the deal if I don't find a buyer or I could find myself a legitimate and simple contract and if something is wrong I only lose the deal and correct my errors for future deals without losing $250-$500 for a lawyer. Does my weighing of options seem legit? What's your opinion?

[Wayne Brooks]

Sit down with an attorney, once. You'll learn things you didn't even know to ask questions about. Once you Understand what the contract language means, and the implications from it, you'll use the same contract and terms over and over again. Study the state standard contract, and that will give you a list of questions.

[Account Closed]

Wayne Brooks
That's what I'll do then. Thanks a lot I appreciate the advice.

[Ned Carey]

Originally posted by @Account Closed:

@Josh C.

Thanks, Josh. I called a title company and they had told me it is illegal to write your own contracts and present them to the seller.

That is absolutely false. You cannot write contract for other people, that is practicing law without a license.

Basically a contract is an offer, acceptance of that offer, and consideration. Consideration is something of value that each of the parties bargain for. (OK this is greatly simplified) The point is it starts with Your Offer. Of course you can write your offer, who else would write it?

What most people call "a contract" is merely the piece of paper that describes the offer. This piece of paper does not become a contract until it is accepted by the other party. (Note contracts can be verbal but real estate contracts must be in writing)

either ignorance, poor and lazy communication skills. I have had title companies say all kinds of stupid things. You'll often see posts here from others having similar experiences.

When I work with a professional, and they don't know what they are doing as well as I do, I am not afraid to tell them so. I would be all over that title company for saying something so stupid.

[Josh C.]

@Account Closed based on the responses you've already gotten you can see your title company is misinformed. However, take the advice above and pay the $500 bucks if you are new enough to not know the difference. Think of it as an investment in your future.

[Bob E.]

Spending a few Hundred Dollars up front will like save you far more down the road. Spend the money, it is an investment in your business.

[Account Closed]

Ned Carey - I did get a sense of ignorance just talking to this guy. I'm grateful I could run my concerns through bigger-pockets. Thank you for simplifying and answering my concerns. I really appreciate it.

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Bob Estler
I absolutely will. I appreciate your helpful, reassuring input.

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Josh Compton
Thank you, Josh. By the responses I've gotten, my mindset regarding the $500 for a lawyer fee changed completely

[Sante R.]

Originally posted by @Account Closed:

If I am making an offer on a property do I need to pay a lawyer to prepare a binding contract or can I legally create my own? How does this process work?

P.S I do not plan on closing. My goal is to wholesale the property.

Thank you ahead of time for any input

-Rob Z

Robert, a Contract is really not that difficult to understand. However, You must take the time to read each item thoroughly. Specific questions can be addressed to a mentor or even an Attorney over the phone. I've done it dozens of times and have drawn up my own contracts. (guess I'm cheap) Do what's most comfortable for you and Good Luck!

[Denisha M.]

Use the state approved purchase and sales/offer to purchase form. When you sign make sure you also write and or assignee so legally you are saying you or someone else can close on this deal and giving you legal right to wholesale.
When people start messing with contracts I think scheme because they usually word it to trap the seller

[Account Closed]

You can write your own contract but I wouldn't even try it until I was sure of what I was doing. I'd talk to a r.e. lawyer and get some contracts or talk to someone at your local real estate investor meeting...then get your lawyer to look at it and make sure you don't get in trouble.

[Account Closed]

@Wayne Brooks

Wayne,

Hope you're having a good holiday.

Do you know where I can get my hands on a standard real estate contract for Illinois?

[Wayne Brooks]

Google.

[Rachel L.]

@Ned Carey

Thanks for clarifying. I'm new too and I somehow thought the offer and contract were two separate documents.

[Account Closed]

@Wayne Brooks

Thank you. But I've been searching google trying to find the most recent and legitamite contract for Illinois but some seem very old so I just wanted to make sure I'm still able to use them. Would you mind taking a look at this link to clarify for me? I'd appreciate it.

http://ilfls.com/free/realestate_forms.php

On this page, are the only contracts I will need the Illinois Real Estate Sales Contract and Illinois Assignment of Contract?