An important note: Don`t call the trust “Wholesale Trust”. @Kris Haskins Thank you man! My head is starting to wrap around this idea. One more question for you. You mentioned your lawyer earlier in the thread. Is it an integral/necessary piece of the puzzle? My point is that from other sources I have received information, a lawyer is not required to establish your land trust. You can simply fill out the forms and have them notarized by your closing agent. If I do not want to conclude with my own funds, would I make the offer with myself as a beneficiary and trustee, then assign my economic interest to my final buyer before closing, and then resign as trustee? If I hire my lawyer to set up my land trust and I make, say, 10 offers for different properties, in the hope of getting one, would I make each offer in another country and then set up the trust that matches the accepted offer? Or do you set up trusts before you make the offer? It seems that it could be very expensive to pay your lawyer to set up trusts if the offer is not accepted. People from all walks of life can become wholesalers, you don`t need to be a real estate professional or be affiliated with a real estate agent to get into this field. With a double transaction, the final buyer may want to do some rehabilitation and make some improvements to the property before finally selling to another buyer. A wholesaler will not bring any improvement because he will not own the property long enough, sometimes less than a day or at most not more than a few days. Any investment in the property must generate an immediate return or be included to facilitate the overall business. In New York, you can`t negotiate real estate transactions without a license (in just about every state). Without a license, you cannot market or promote a property for sale.
This is a flagrant violation of New York State law. You can only market the rights to award a contract as a wholesaler. This allows you to assign the contract to another investor because the contractual rights are under the trust or LLC and not under an individual. You sell or deny the business to the new investor for a fee. In many cases, the entity is created exclusively for this transaction. Find out how Carl covers real estate wholesale and how wholesale trusts can be a boon to your real estate strategy. Be sure to consult a real estate lawyer to confirm that the terms of the agreement are legally sound for all parties. Here are some common parts of a wholesale contract: This lady tried to manipulate the comps` data so that my buyer and I would buy near the ARV. She tried to look really savvy by saying that she has made money from real estate in the past and that after buying at $56,000 and investing about $13,000 in the property, we were able to make a good profit of $20,000. She also told us that a similar house on the street sold for $80,000. However, my cash buyer told me that she was just another wholesaler who wanted to return the contract for a big payday.
Since this lady refused to work with our $40,000 offer, we did not do business with her. It`s a shame she couldn`t close the property and lose her serious cash deposit, but on the other hand, I shouldn`t have to pay for her mistake and poor planning. The process would look like this: Make an offer as YOUR NAME “ABC Investment Trust Trustee” – exact acquisition of TBD at closing. This is done so that you have time to market to a buyer once your offer has been accepted. Once your offer is accepted and you use your 14-day inspection time to find your final buyer, mark them as a beneficiary just before closing, charge your wholesale fees, and have the escrow agreement notarized by your final agent. Upon closing, you resign from your fiduciary position and ask your final buyer to appoint a new trustee. The name of the security never changes, so I cancelled the bank`s “non-transferability” clause, I was about to make an offer until my broker sent me the bank`s “REO Buyer Prescreen” form. At the end of the form, the following information will be requested when you make an offer through the trust Full name of the legal entity Full address of the tax number of the legal entity # Status of the organization Names of all owners of the legal entity Name of the parent company Address of the parent company Name of the person w Signing authority Of course, this turns out to be a problem with the above method of wholesale with the land trust….