Selling my interest/rights in llc when wholesaling REO's

[Paul Shinn]

A question – We are looking at wholesaling REO's. We intend purchasing a REO's in a llc and then selling our rights/interest in the llc and collecting our fee.

What we need to know are the steps involved in doing this correctly.
For example:
Step 1: A signed sales and purchase agreement on the property
Step 2: Find buyer
Step3:
Step 4: and so on
• Non refundable earnest money - where do we deposit this?
• Which parts are done in escrow?
• What forms do we need to make this legal?
• Do we need our lawyer’s involvement?
• When do we get paid?
• Who needs to show up for closing?
• What are the potential lawsuits and what do we do to prevent this from happening if something goes wrong in the future with the property?
• What disclaimers if any do we need to get signed?

all help would be much appreciated

thanks Paul

[Dion DePaoli]

The difference is in one transaction you are selling the real property and the other transaction you are selling your company.

If you sell the property, the transaction is like every other real estate transaction with all the features such as escrow, contract, real estate taxes and fees, etc.

If you sell the property, the properties are already vested in the name of the LLC on title. The sale of the company would mean selling all the assets and all the liabilities of the company in the sale. Usually this is a barrier to completion as nobody wants to inherit other operators liabilities. Certainly some contract language can be created to deal with this but it gets complicated and messy. This is administratively intense. You will need to have accounting reviews, perhaps audited financial statements and reviews of all your corporate documents. Needless to say, this can be intense and expensive to accommodate a sale.

There is no justifiable reason in the post to sell the company opposed to just sell the real property. Perhaps if you share why you think that is the best options some comments can be made addressing your thoughts.