Hi all,
Please excuse my ignorance, but is anyone out there experienced in the assignment of contract method? (a quick cash method). I would like to know more about it…
First of all, John Burley’s manual says that you never actually own the house. I know this is a stupid question, but how would you actually make the profit? Do you just have a written contract with them saying that they will pay you $x for assigning the right to buy to them?
Ok, just say the house is really worth $100,000 (after doing my due diligence). I find a desperate seller who sells it to me for $75,000. I put 1% down ($750) – I place some ads and get some interested people. I intend to mark it back up and sell it for $90,000. But for me to actually sell the house at $90,000 – wouldn’t I actually have to own the house??
Can someone enlighten me please?
Bris
I believe you can do this by using and/or nominee (in some states at least). But you have to have an agreement in place with the person you are going to nominate beofre you sign the contract-otherwise stamp duty. This way you don’t actually ever have to own the house.
Another way to do it is acquiring an option to purchase, and then selling the option.
Or you could just onsell.I have a friend doing this in Sydney at the moment. She bought at an auction and had found a new buyer straight away 9or maybe even before). She is organising a simultaneous settlement so that she won’t even need a loan, however she is getting a loan preapproval just in case the reselling falls over or takes too long. It will be interesting to see if the bank valuation on the resale will come in at the price the onsellers are going to pay (about $40,000 more than she bought it for).
good luck
Terryw
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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