by Horizon CRE | Jun 5, 2021 |
If you are ready to invest in commercial real estate in Oklahoma, you might be interested in something called assignment of contract. Assignment real estate may seem complex, but it is a simple agreement. Anyone who chooses assignment contracts should be aware of the contract details along with possible changing laws and regulations.
Assignment of Real Estate Purchase and Sale Agreement
Real Estate Assignment Contract
An assignment of contract occurs when one investor or buyer assigns a real estate contract to another. The contract is the right to buy, not the final purchase, so the rights are transferred. For this to be legally binding, the original agreement must allow for the initial buyer to transfer their rights. In the process, the individual who transfers their rights gains a fee.
What Is an Assignment Fee in Real Estate?
When investors make money off of multiple assignment real estate deals, they are wholesalers. Essentially, they connect the final buyer with the seller, and the contract will outline the fee the wholesaler retains. So, “what is an assignment fee in real estate?” In many cases, the fee is $5,000. The details will all be outlined in the final assignment of real estate purchase and sale agreement.
What to Know Before You Invest in Commercial Real Estate in Oklahoma
One of the benefits of wholesaling in real estate is that you do not need a large amount of capital to start. You do, however, need to go through with the purchase if you cannot find a buyer or one were to back out of the deal.
One thing to be aware of is the negativity surrounding wholesaling. State bill OK HB3104 would have limited wholesale investments. While the bill ultimately died, it did pass the House, so be aware that the laws could always change. Ultimately, working with a licensed real estate professional will reduce problems with wholesale investments.
If you would like to invest in commercial real estate in Oklahoma and you would like to discuss the best strategies for you, please contact us. We are here to help you make an informed decision as well as a return on your investment.