Are there alot of you doing assignment deals directly with an end-buyer and with the homeowners, verses working with agents? I have been advised to make sure to get a fairly large earnest deposit from the end-buyer at the time I assign him the contract, that way he will have a vested interest in following through with the closing of the property weeks later. If he signs a contract that saids that he will pay a substantial deposit at closing or at escrow, I believe he can still walk away any time before settlement and not lose any money. Is this the case?
I was told if I don't collect a deposit from the end-buyer/investor and he decides not to purchase the property a few days before closing even after he has signed the Assignment Agreement, and the homeowner has already started moving out, and therefore may have already accrued moving expenses, there could be legal ramifications. I would have to go back to the homeowners and say he changed his mind. Now they are stuck paying for their moving expenses. Couldn't they sue me or demand my initial deposit back, or even refuse to sign a deposit release agreement? Would working with seller agents and buyers agents protect me more? If so, is it true that once a property is listed in the MLS, I as a wholesaler need to have a buyer's agent represent me, whether I have my own or the seller's firm appointed one for me?
I appreciate any advice or suggestions.