All Forum Posts by: Mitch Freed

You can really use any contract you want...purchase and sales, option contract etc...once they accept you become a principal in the transaction and have the legal right to market that contract or the house in general to an end buyer.

The option contract usually works best because that contract can contain specific wording that gives you the right to market the property as the seller.

A purchase and sales contract technically does the same thing...you will definitely want to include and/or assigns on all purchase contracts.

I've got to run here but can go into more detail on how I've gotten these deals done and can provide some example contracts that I have used.

You might call up the paper and pennysaver and try to post an "I Buy Houses" ad...the paper could have a special section for ads like that which you haven't seen yet or perhaps people have posted those ads with little to no responses and it has become well known that the paper is not a good medium for those types of leads.

George,

I am surprised to hear that the County Recorder does not offer access to public records.

You might also try your local title company...free searches would include trust deeds which will show junior liens..but judgments and mechanics liens will only be found via a more detailed and time consuming title report...which is usually pulled once a transaction is opened. If you are researching a particular property then the title company may charge you and the cost will depend on how long it takes them to pull all the data...if there are lots of liens then it might cost more.

At least thats how it works here in Portland.

On a side note..i'm in Baltimore right now and the weather is unbelievable. Your downtown is a lot like Portland Oregon...very beautiful!

You can purchase the property with your LLC if that LLC exists...therefore you need an operating agreement, you are a member, LLC's do not have owners, or you authorized to sign on behalf of the LLC. But in any case that particular LLC needs to be real.

If you write an offer with an LLC name, negotiate the short sale while you advertise for an end buyer, then get the approval, and then have the end buyer become the LLC member...then technically you wrote an offer with a fake LLC name and would be considered a "straw buyer."

I have seen some people do this successfully...but would advise to not take part in it...I am not an attorney but writing an offer with a fake LLC sounds illegal.

But here is how you can do it legally. Create the LLC first by going through all the normal steps, you are the member, so you can legally write the offer with the LLC as the buyer. Once you get the approval and the end buyer you can then ask the foreclosing lender if they will change the name on the approval letter...this is assuming that the approval letter was specific enough to state that your LLC is the only entity or person that can close this deal. Some approval letters are not specific so anybody can close the deal.

In these cases though you will either be attempting to double close, simultaneous close, or have the end buyer close and pay you an assignment fee or finders fee outside of closing (pending the wording of the approval letter of course)

There are quite a few ways the ABC can work...just make sure you aren't breaking any laws.

What would your exit strategy be? Are you looking for a place to live or a place to flip or keep as an investment...i cant imagine a house at this price would cash flow as a rental.

Also, short sales don't just get approved without and offer being presented first. The approval process if more in depth than the agent telling the bank what he/she thinks it should sell at.

County records should show the trust deeds on the property so you can get a rough idea of what is owed...then you can determine if the 599K offer is even close to something the bank might approve.

You can also just ask the agent if that 599K approval was received in writing...if not..then that is not an approved short sale.

If you want to know if the price is a good deal...don't ask the listing agent...ask somebody who can give you an unbiased answer. Or do your own research...call up a title company and have them look up recent transactions that are comparable.

What sort of contract do you have on the buying side...standard purchase and sales, option contract? Have you received your approval letters yet on any of these deals?

Or you could write it up to have your inspection period start once you find the end buyer...so if they do their inspection and back out due to some issue...then you either back out, renegotiate, or extend the inspection period again to find another buyer.

You could pay him a non-refundable option fee of $10 and write it up as a non-exclusive option.

Why not just write up a standard purchase and sales contract with "and/or assigns" added to the buyer name section.

Extend out the closing date which will allow time for you to market to your end buyer and then just assign the contract.

If you put the 500 in escrow that protects your interest in the property.

It sounds like the wholesaler may not be involved in the transaction anymore...he/she could have walked away...was this a short sale?

Have you tried contacting the owner of record to find out if a contract still exists between them and the wholesaler? Or even tried checking county records to see if there has been a change in ownership recently?