Novations saved the day!! I was working on a retail deal where the seller bought the property a year ago on a handshake, remodeled the house, and paid the final payment in April. We listed the property on the market and went under contract on an FHA loan in less than thirty days. However, we discovered that the seller never recorded any deed for the property until he made his final payment in April. He is now in the process of deeding the property over to his name. When the buyers went to put down earnest money, the title company put a stop to it because the property was not in the seller’s name. They said the deed had to be finalized before proceeding with the sale. The lender then stated that because it’s an FHA loan, and due to the 90-day flip clause, they would not be able to fund the deal. Consequently, we could no longer proceed with the sale. Enter the novation. We decided to cancel the filing of the deed, leaving it in the previous owner's name, and create a novation agreement with the previous owner. The new owner, who invested about $150,000 in rehab into the property, will now be able to sell it FHA. The previous owner will receive what they were supposed to on paper, and the new owner will receive the difference after his rehab, allowing the FHA loan to proceed and the property to be sold. This creative solution ensures both parties get what they deserve and the transaction can continue smoothly.

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First off, the subject of this conversation is a property we actually closed on and got funded today 🤩 So this particular LEAD was acquired about six months ago. They reached back out to me in March. One thing I’m big on when it comes to talking to working with sellers, is 1.) acquiring as much information as possible about their situation and their timeline and 2.) what it looks like for them once they close and are funded. Like most deals, I do, this was a virtual deal that I was able to acquire a contract on based off our conversation site, unseen. Originally this was Contract at $239,000 with an estimated rehab of $65,000 based off the conversation with the seller. Once we did our inspection, we realized that our rehab cost was practically doubled and that the condition was not anywhere near what the seller described to us. (it’s important if you are doing anything virtual to always have boots on the ground in the market to do a walk-through once once you get a contract) So we were able to negotiate this down to $139,000 and we listed it on market for $199,000 anticipating at least $30,000 By collaborating with @Beatriz Saucedo as the listing agent, she was able to bring us multiple offers in about four days. Which was a great turnaround time for a home that needed over $100,000 in rehab We acquired a cash buyer for this property. And we thought we were good and had a clear path going forward.. Then we found out there was multiple liens on the property from taxes to solar and another lien that totaled about $108,000 Fortunately, by working with the right title company, we were able to get everything done and cleared, But the numbers completely completely changed from what we were originally able to offer the seller to our bottom line what we were going to walk away with Overall, the deal ended up and the seller understood that they all they could from the property before selling it.. this ended up being a win-win situation for everybody involved

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I want to open this discussion regarding working with wholesalers… I’ve been an agent for almost 4 years now, but got started in real estate on the wholesale side. Over the years I found it difficult to work with agents as a wholesaler, mostly because of the unknown. Once I became licensed, I was able to step into an agents shoes and experience the calls for comps, the promises for listings and promise of opportunity to bring buyers for a split. UNFORTUNATELY I as an agent just kept giving but never saw a return. That being said. What’s been your experience? Have you partnered with wholesalers to do deals? If you have not, why? This would be a great forum to really open up about experiences and find a way to actually collaborate fairly. What are your expectations when working with a wholesaler?