Flipping houses has many implications. Investors
buy a property, rehab, renovate, and then sell for a considerable profit. A type of investor is a wholesaler.
A wholesaler places
(typically) distressed property under contract and transfers or sells the property
to another investor. Someone can use this opportunity to build income with
little capital or credit. The investor uses cash, lines of credit, or hard money
loans. This allows quick closings on properties that sometimes need many
repairs.
Typically, it is illegal for anyone, EXCEPT for a Realtor or
Broker to sell a home for a third party. Wholesaling real estate can be illegal
if not done properly.
The majority of real estate contracts do not state that it is
assignable. However, a clause can be added that states you have the FULL right
to “ASSIGN” which means 'giving up' your right
to purchase a piece of real estate by selling that right to another investor,
your buyer. The contract that you assign is the original purchase agreement
that the homeowner signs with you.
Also, write in an escape clause in special provisions
that will allow you to terminate the contract at no fault if you are unable to
find another buyer. An escape clause could be as simple as "the offer is
subject to my partner's approval."
This is just business like any other and the free market system - buying low and selling high - nothing illegal about that.
This is just business like any other and the free market system - buying low and selling high - nothing illegal about that.
According to cnbc.com U.S. wholesale inventories rose as expected in August while
sales at wholesalers posted the first gain in four months, government data released
on Wednesday.
There seems to be lots of opportunity in
Somerset, Middlesex, Union Counties here in NJ.
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