Contract assignments are probably the simplest and least complex profit generator of the real estate profit models.
Basically it's an excellent way for those looking to get into real estate with zero to very little money. So if you're short on cash or don't want to finance properties this profit model is a great opportunity. This is fast becoming a popular second career because it's so simple for you to get started. Basically all you need is motivation, basic marketing knowledge, and basic knowledge on how these deals work.
So just what is a contract assignment?
A contract assignment happens when you negotiate a sales contract with a homeowner to purchase his or her home, never intending to take possession or title of the property. Once the contract is properly executed, you may sell that contract to a real investor or rehabber that will take possession of the property.
You will profit in the form of an assignment fee that is paid to you by the investor. Typical fee is about $500-$3000 per assignment.
How do you find properties that are candidates for you to assign?
There are many types of homeowners that will be willing to negotiate a contract assignment type of arrangement with you.
One great source are homeowners in preforeclosure.
Were assuming the owner your talking to has no means of continuing monthly payments. It could be due to many things, job loss, divorce, injury or a spouse passing away, more than likely they have missed a few house payments as well.
Your job as a contract assignment consultant is to evaluate the deal on many levels.
First you may ask…is there enough equity in the home to make the deal attractive to a real investor?
If yes you can move forward
Keep in mind …you are providing a solution to the distressed homeowners problem. Typically you may offer to pay off the mortgage in full including back payments. Also, keep in mind you'll be making an offer of about 70% under market value to make it attractive to your down-line investors.
It's also reasonable to offer exit cash to the owner of a couple thousand dollars depending on how much equity the owner has built up.
So when you assign the contract to a real buyer who actually takes title to the property, the foreclosure stops as well as stopping further damage to the owners credit plus giving the owner some breathing room in the form of cash to pay bills or move.
Your investor is happy because he has a below market price property to sell or rent and you collect a fee for bringing the buyer and seller together.
This is a simple example. What will make you stand out to buyers and sellers is how organized and professional you deliver your information.
So where do you start really learning how to assign real estate contracts?
Why not learn real estate contract assignment the right way?
See the link at the bottom for more information.
Learn real estate investing by learning the contract assignment the RIGHT WAY – Visit: Contract assignment Credit Repair.
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