I’m looking into assigning contracts on lots over 50$k. I read on Seth’s module that assignments generally need to be cash because of financing companies lack of information. Is this correct ? I would think if the contracts are with a title company then the mortgage company would still finance without problems? How common is this?
@ascheurer you could call a title company or a mortgage financing company and ask them these questions (since it's their call on whether the deal can close via an assignment with financing involved).
@retipsterseth
I’ll verify that with title. On your module there was a sentence that made it seem like financing companies didn’t like funding deals that are wholesaled. I tried to screen shot it and post it but it wouldn’t do it. It was on the bonus assigning contracts section towards the end of the module. Thanks for replying.
@ascheurer - yeah, that's always been my experience. I'm sure any other professional wholesaler who assigns contracts can chime in here with their experience as well. Part of the reason conventional lenders don't want to get involved with assignments is that they would basically be financing the wholesaler's assignment fee, which has no collateral value. Many of them have policies against financing deals that are assigned, unless the assigning party is somehow related to the deal (like an individual assigning it to an LLC they own, or vice versa).
@retipsterseth
Interesting , I thought they would use the appraised value. Guess not.
I’m open for suggestions on alternative financing that I could relay to buyers who are looking for financing.