Contractual question

[John Benedict]

Hello, first post here. This is a really good site! I'm looking forward to becoming a part of this community sharing my experiences and learning from others here.

I have been researching REI for some time now and finally feel ready to jump in and swim. I intend to start out with wholesaling since I don't have much capital and am not very optimistic about finding lenders willing to take a risk on a newbie investor.

So I've been in contact with a local investor I've done business with in the past to get some mentoring and advice as I start out. One of the first things he mentioned is that most title underwriters will not insure a contract with assignment nowadays and so without cash or loan approval it's going to be very tough to get started.

Is this going to create a major obstacle? I'm still a little unclear as to whether title insurance is needed or what the advantages are.

In all my research I haven't seen a whole lot written about the details of the transaction and contracts, insurance, etc. needed to do these types of deals. I am grateful for any help you guys can lend.

[Mike Nelson]

Welcome! Title insurance is big on the buyers side, buyers want a free and clear title if they plan on rehabbing the property. Example: I've recently done a deal where the property was inherited, let's say that multiple ppl could have the right to the property but one person was on the deed. If the buyer purchased this property w/o title insurance then he would be responsible for lawsuits that the other parties could file.

Sorry if that wasn't clear but basically title insurance is a must for the buyer. They would like to make sure that if a lawsuit does arise from past owners as to who has the right to the title then the title insurance will protect them.