Summary of "Wholesaling Real Estate CONTRACTS for Purchase and Sales Agreement and Assignments (Day #5)"

In the fifth day of the 30-day wholesaling challenge, Ricken provides a detailed guide on how to write a wholesale contract, focusing on two main types of contracts essential for wholesaling: the Purchase and Sales Agreement (PSA) and the Assignment of Contract. He emphasizes the importance of ensuring that these contracts are legally sound by consulting with a title company or real estate attorney.

Main Financial Strategies and Business Trends:

Utilization of Simple Contracts: Ricken advocates for using a concise two-page contract when dealing with motivated sellers, contrasting it with the often lengthy realtor contracts.
Negotiation and Clarity: He advises reaffirming verbal agreements in writing without introducing new negotiations during the contract writing process.
Earnest Money Deposits (EMD): He discusses the flexibility in deposit amounts, noting that motivated sellers might be more lenient.
Closing Dates: Ricken recommends setting a longer closing date to provide flexibility and time for finding cash buyers or resolving any issues.
Inspection Periods: He suggests requesting the longest inspection period possible to allow for due diligence and to facilitate bringing in cash buyers.
Assignability of Contracts: Emphasizes that contracts must be assignable to enable wholesaling.

Methodology/Step-by-Step Guide:

Obtain Template Contracts: Download the provided contract templates.
Fill Out the Purchase and Sales Agreement:
- Date the agreement.
- Identify the seller and buyer.
- Describe the property in detail, including legal descriptions.
- Specify the purchase price and earnest money deposit.
- Include prorations and closing date.
- Ensure the contract is assignable.
- Clarify that the seller maintains the property's condition until closing.
Fill Out the Assignment of Contract:
- Identify the assigner and assignee.
- Attach the original contract.
- Specify the assignment fee.
- Outline the total amounts owed and closing details.
- Include clauses that protect against direct communication between the buyer and seller.