Why I like to use the MLS Sales contract to do deals

The MLS (Multi Listing Service) contract is the sales contract used by real estate sales agents.  This being so a ton of money has been spent in making it perfect to serve the agents that use them.  Whenever you do business in a state where an attorney is involved in the closing of a deal, the attorney always bark at every sale contracted presented to them other then the MLS sales contract.  Not that other sales contract aren’t relevant, its just the attorney always bring up points with the contract so that an entire new contract is written up.  To avoid this time lag and terms you want to get across, I use the MLS sales contract to do all my business.

Nick what about the loop wholes and all the escape clause in these special contracts?  If you have to many escape clauses in a contract typically by the time it gets to an attorney, he/she will see this and throw it right out.  Simply said, to go under contract with a seller you need to be aware of how to confirm to what is normal to the real estate society.  So stop using these special sale contracts and fancy escape clauses because they really aren’t real.  Sure you can get away with it in states where attorneys are not involved in the sale but it doesn’t mean you are a true investor.  True investors understand how to work in any environment, attorney involved or not.  Point is… its not that difficult to begin with so why not right?

– Want to know all the escape clasues I have in my contracts?
– Want to learn how to make MLS contracts assignable?

Nick Tang

How to flip houses with $1

Say you met a homeowner who is selling their house. Typically when you go under contract with the homeowner, they understand that a sale price must be agreed upon and a down payment amount will be brought to the table to close. As a rule, you never ever give down payment money to the seller. If you do, you will most likely lose it. This being so we always give down payment money to our attorney or title company handling the sale.

On the day the contract is being drafted up, at the homeowners house, attorney office or title company, you don’t give anyone any down payment money.  You aren’t suppose to put down any down payment money until you are out of attorney review and out of your x day window of inspection.  That means you have have time to find a buyer or cancel the contract.

You just got to make sure to write up the paperwork with the seller saying your buying the property for $500k and how much you will put down after x day of due diligence. Typically I put “I will put 20% down after 30 days of inspections/due diligence.” << This is very standard in the industry. This being said, in essence you don’t even need the $1 to put a property under contract.

So why is the $1 even needed? Some states require an actual consideration to be conveyed this being so I use $1.  Whenever I have to do the $1 consideration with the seller, what i typically do is sayd say, to make this “contract legal and binding I have to give you some sort of consideration, here is $1.” Once this dollar is exchange and the contract is sign, i now have control of the property. That means if I put the property under contract as an llc, I can now sell the llc. If we signed a contract that was from the beginning assignable I can now assign it.

Note, this $1 earnest money strategy does not work with deals on the MLS.  The reason for that is because Realtors expect $500 to $5k as earnest money to put a property under contract.  Read how to flip houses on the MLS to learn more.

Like my write up?  Want to learn more on how to wholesale houses? I invite you to look into my Wholesaling for Quick Cash training video.  Go to the link and scroll to the middle of the page for a 20 minute segment of the video.

Nick Tang
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*This is not being promoted as legal advice. Please speak with your attorney before doing any of the above.

How to flip when you can’t assign a contract

At times the seller or the Realtor doesn’t allow you to assign a contract. So how can you sell a contract when it isn’t assignable? As a standard procedure i always put houses under contract with llcs. The reason for this is because whenever i can’t assign the contract i simply sell the membership interest […]
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Assignment of Contracts

Whenever I put a house under contract to buy I always use the standard Realtor sales contract. If you ever read the contract you will see that it states you can not assign this contract. This being so, if you cross it out and put your initials on it and get the seller to do the same then the contract will now become assignable.

Along with the above, when putting properties under contract to assign I typically put “123 street name llc” as the buyer along with the words “and or assign.” Doing so would allow you to assign the name of the buyer on the contract to anyone you wish.

How does an assignment contract look? Its simply as this:

123 street name llc agrees to assign all rights of the contract written up between x on x day for a fee of x. Please sign below if you agree.

I know it seems very simple but that is it.

Want to learn more on how to wholesale houses? I invite you to look into my 101 wholesale training video.  As always, if you didn’t learn anything from the video just email us and we will gladly refund you your money.

To your continued success

Nick Tang

*This is not being promoted as legal advice. Please speak with your attorney before doing any of the above.