Lawyer Won’t Allow Your Co-Wholesale Fee? Here’s What To Do…

2015-4-21-260The question that we’re going to discuss today has to do with one of our members and her attorney – so that means right up front we’ll state that we are not now, nor will we ever give out legal advice.

So with that being cleared up, let’s take a look at the question from Linda Steward from Windsor:

“I’m in the process of doing a deal. My question is I am working with a lawyer, and he is giving me crap about the Marketing Agreement. He won’t put my fee anywhere in the deal. What should I do? Besides firing him.”

patrick-round-240Patrick’s Take

I can tell from this question that Linda is a 10-Wholesaler student and is using the Marketing Agreement method as taught by Justin Wilmot in that training program. This means Linda is specifically referring to a strategy when closing the 10-Hour Wholesaler deal, as to how to set up the paperwork and get paid.

So Linda, here’s what I’d suggest right off..

You could structure it as a double assignment. You have the original wholesaler – who has the Purchase and Sale with seller – assign the contract to you. You could then turn around and assign the contract over to your end buyer.

That would give you a structure to work with that will get this closed. This may be the easiest and simplest way to get it done.

jp-round-240Jp’s Input

Here are my thoughts, Linda…

If this attorney is shutting you down because he thinks you’re trying to practice something funny – if he’s mentally shutting you down – this may not work.

But, if he’s trying to help you come up with a solution, or he’s open to your thoughts of making this work using another path, then a better way may be to simply create an invoice. You can make a legitimate-looking invoice and send it to the title company for the closing.

This would be much like when a termite inspector gets paid out of the closing. That happens all the time. Or someone who does a survey, for example.

2015-4-21-lawyerMany things like this get paid at closing – it happens all the time. All those companies do is submit an invoice, and a check is cut to them at closing.

Your invoice could state: Marketing Prep Fee

What does that mean? It can mean whatever you want it to mean. You did the marketing, right? And the word prep kind of sounds like what they charge you for on a HUD anyway.

Now they’re presented with a legitimate invoice. As long as neither the buyer nor the seller rejects the idea, then they can add you to the HUD that way.

The way that Patrick explained will work as well. This is just a matter of spinning the deal in a different direction. The key here is to get the people involved to work with you. This will ensure that you’re protected and that you get paid.

And in the future, Linda, I suggest that you look for a new attorney. One who isn’t so hard-headed when it comes to closing these deals.

Worth Saying Again

To reiterate, we want to emphasize that legal advice is very important. And we want to note that nothing we say here is to be construed as legal advice. Definitely consult with a legal professional who can advise you on any techniques and strategies in your area when using your business model.

The Windup

Look, it’s always good when building your team to try to locate an attorney who is friendly toward investors, and who understands how our business works.

But even at that, this Q&A session should prove that there’s always more than one way to get a deal closed. The key is not to get discouraged and never give up.

Chime In

Have you had a similar obstacle come up in your business? Tell us about it. We love hearing from you.

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