Logistics of Purchase Contract Re-Assignments with REALTORS

[Matt57]

Hello everyone,



Perhaps I can pick a few brains on a issue I've been having.



As a lifelong resident of Calgary, I've started expanding my horizons with purchase contract re-assignments. Instead of the 'wholesale' approach of trying to find undervalued properties, the market in Calgary has been so hot that I've been able to buy and re-assign real estate at fair market value in a very short amount of time.



I have been successful in finding FSBO properties, making a competitive offer to purchase along with a nominal $5,000 deposit, and re-assigning the contract within 30 days to another interested buyer for the cost of the deposit plus a $5,000 re-assignment fee. The new buyer inherits the purchase contract, closes on the sale and everyone goes on their merry way.



However, I recently tried to put offers on homes that are listed with Realtors....and it hasn't been easy. Here are the hurdles:



1. They want me to bring my own Realtor to the transaction

• I'm not personally closing on the sale, so I cannot bring my own Realtor to the transaction. It's a waste of their time as they would not receive a commission if I re-assign the deal to someone else, unless the re-assigned buyer hires them as their representation. Most often, the new buyer either brings their own Realtor into the transaction or chooses to represent themselves.
  
  
  2. They want me to sign a buyer's brokerage agreement (sometimes before they even allow me to walk through the property).

• 
  
  
  Same as above. I'm not personally closing on the sale, so I will not sign a buyer's brokerage agreement nor can I count on the re-assigned buyer to follow suit with this either.

So my question is this:



What logistical process should I follow in order to tie-up a property for eventual re-assignment, when the property is listed by a Realtor instead of FSBO?

 

[Thomas Beyer]

Two options:



a) Just write the offer. The realtor may decide to not show it to the seller if it is low. You could decide to ignore this and as such expect out of ten offers only five get accepted, or you can threaten the realtor that you will report him to RECA in that case. That will cause you to make many enemies, of course.



B) Sign the buyer acknowledgement form. All it says essentially that the realtor is now in a dual agency relationship and is conflicted, ie he does not only represent you. That still allows you to assign the contract for a fee as long as the contract is properly worded. The commission is paid by the seller anyway, whether you close or the assignor. So, why not sign it ?

 

[ChrisDavies]

A couple thoughts. First buyer brokerage is becoming mandatory across Alberta this summer. You can sign a customer acknowledgment but you'll have to communicate that to the agent and it'll take time for everyone to figure out the new paperwork.



If you're just there to be buying and selling properties which aren't yours - like you've said you have no intention to own it, just to flip the paper - and you're making money at it you're moving into a licensed activity. That means that RECA may have a big problem with it.

 

[Thomas Beyer]

[quote user=ChrisDavies]



If you're just there to be buying and selling properties which aren't yours - like you've said you have no intention to own it, just to flip the paper - and you're making money at it you're moving into a licensed activity. That means that RECA may have a big problem with it.





maybe, likely not. Tough to regulate or sanction non-licensed people. Government is already too big and RECA regulates realtors, not private citizens. What recourse would RECA have here actually ?



Maybe you also need a law degree to handle any legal contract ?