Wholesaling Real Estate – The Power of And/Or Assigns

To be able to wholesale real estate without first closing on it yourself, you need to be able to have your buyer take over your position in the contract that you have with the seller. Usually, we accomplish this by assigning our rights in the contract to our buyer and having our buyer close directly with the seller.

However, as a real estate investor I occasionally get a real estate contract that does not have a section that would allow me to make the contract assignable. How do you deal with this? Well, my late mentor, Brent Grove taught me the power of “and/or assigns.” While you will want to verify that contract law is the same in your state, in most contracts anything that is hand-written into the contract takes precedence over anything typed. So, if, when you write out your contract, you use your name as the buyer name and then add in the words “and/or assigns”, even if the contract states that it is not assignable, then the contract becomes assignable.

So, as an example, if I was writing a contract with Suzy Seller and my name was Bob Buyer, I might fill out the contract so that for the name of the buyer it would read:

Bob Buyer and/or assigns

If Suzy Seller agrees to the terms and signs the contract, then that contract becomes assignable. So, if I then sent out an e-mail blast to my list of thousands of real estate investor buyers to tell them about this new deal that I have, I could assign my contract to them. For a small assignment fee (which is often also called a wholesale fee), I would assign my rights and interest in that contract to my investor buyer and they could then purchase the house directly from Suzy Seller using my contract.

So, with that tiny phrase, “and/or assigns”, you can take just about any contract and make it instantly assignable.

Until my next post,

James

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