Summary of Wholesaling Real Estate CONTRACTS for Purchase and Sales Agreement and Assignments (Day #5)

In the fifth day of the 30-day wholesaling challenge, Ricken provides a detailed guide on how to write a wholesale contract, focusing on two main types of contracts essential for wholesaling: the Purchase and Sales Agreement (PSA) and the Assignment of Contract. He emphasizes the importance of ensuring that these contracts are legally sound by consulting with a title company or real estate attorney.

Main Financial Strategies and Business Trends:

• Utilization of Simple Contracts: Ricken advocates for using a concise two-page contract when dealing with motivated sellers, contrasting it with the often lengthy realtor contracts.
• Negotiation and Clarity: He advises reaffirming verbal agreements in writing without introducing new negotiations during the contract writing process.
• Earnest Money Deposits (EMD): He discusses the flexibility in deposit amounts, noting that motivated sellers might be more lenient.
• Closing Dates: Ricken recommends setting a longer closing date to provide flexibility and time for finding cash buyers or resolving any issues.
• Inspection Periods: He suggests requesting the longest inspection period possible to allow for due diligence and to facilitate bringing in cash buyers.
• Assignability of Contracts: Emphasizes that contracts must be assignable to enable wholesaling.

Methodology/Step-by-Step Guide:

1. Obtain Template Contracts: Download the provided contract templates.
2. Fill Out the Purchase and Sales Agreement:
   • Date the agreement.
   • Identify the seller and buyer.
   • Describe the property in detail, including legal descriptions.
   • Specify the purchase price and earnest money deposit.
   • Include prorations and closing date.
   • Ensure the contract is assignable.
   • Clarify that the seller maintains the property's condition until closing.
3. Fill Out the Assignment of Contract:
   • Identify the assigner and assignee.
   • Attach the original contract.
   • Specify the assignment fee.
   • Outline the total amounts owed and closing details.
   • Include clauses that protect against direct communication between the buyer and seller.

Presenters/Sources:

• Ricken (Presenter of the video)

Notable Quotes

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Business and Finance

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