As an investor, you will want to understand the ins and outs of a wholesaler agreement for properties in Chicago. Learn about the process and expectations in our latest post!
An investor wholesaler agreement or a wholesale real estate contract will be used when a Chicago investor and a local property wholesaler, work together to find a profitable property at a low price. The wholesaler puts the property under contract with the seller, then assigns the contract to the buyer. In essence, the wholesaler acts as the go-between between the buyer and seller, connecting two parties who may have not met otherwise.
The contract should be drafted and reviewed by a real estate attorney to ensure all terms and clauses are legally sound and make sense for all parties. There are a number of templates available online, but you should always have your lawyer review your final draft. The contract will typically include the details of the property along with the payment terms. Everybody’s responsibilities will be outlined clearly so there are no discrepancies.
The first contract, or purchase agreement, will be between the seller and the wholesaler outlining the terms and the timeframe. This contract will give the wholesaler equitable interest in the property, allowing them to find a buyer to become the equitable owner of the property. The original seller holds the title until everything has been completed and all documents are signed. Once accepted, the wholesaler is able to present the contract to Chicago investors like you! Be sure to have a clear understanding of the terms, contingencies, and conditions. Your part of the contract will be very similar to a standard contract between a buyer or seller. Expense and credits will be outlined and a title search completed. As the buyer, you shouldn’t expect too much to be different from a traditional real estate purchase.
A Few Items Included In the Contract:
- Parties involved – This includes the buyer and the seller
- Description of the property – The address, property type, and legal description from your local property appraiser
- Purchase price – The price, deposit, financing terms, and any other financial items are included here
- Included property – Aside from the physical structure, this is for things like fixtures and furniture
- Property condition – A general description of the property at the time of sale
- Contingencies – If the property does not meet certain criteria after the inspection, the buyer is able to walk away from the deal
- Lead paint disclosure – This is standard in all real estate contracts notifying the buyer of lead paint in the home
- Deed Type – This clarifies the type of deed being conveyed to the buyer
- Buyers clause – Outlines the rights of the buyer during the sale process
- Sellers clause – Outlines the rights of the seller during the process
- Risk of loss/damage – Outlines what will happen if the property is lost or damaged before the sale has been completed
Professional wholesalers, such as the team at Chicago Home Buyers, work with individuals in the Chicago area who are looking for a fast and fair way to sell their homes. We typically have a number of properties available, and if we don’t have what you want, we are able to find it for you! When we work with investors who want to buy wholesale properties in Chicago, we will typically like to close on the property within 7-30 days. As the buyer, it is up to you to have the financing in place and the ability to close on the property in the timeframe outlined in the contract. Defaulting on this could cause you to lose any deposit money paid.