Florida Real Estate Investment Advice for Buyers: Assignment of Contract

An assignment of contract is where one party - the assignor - transfers their rights to another party - the assignee. In Florida real estate, let's say an investor contacts the owner of a pre-foreclosure property and enters into a contract to purchase the property for say, $100,000. The investor can either close on the property and resell, or assign the rights of the contract over to another real estate investor for say, $120,000. Assuming the property is worth $150,000 then both real estate investors should make a sizeable profit.

Why would a real estate investor sell the property under an assignment of rights? Perhaps the original investor wants to focus on finding pre-foreclosed houses, turning them over quickly to make a profit; the property may need some repairs or maintenance work that are beyond the capabilities of the original investor; or the original investor may not have the funding necessary to close on the property or to continue financing until it is sold on the open market.

As a real estate investor, you can use the assignment of contract to either sell their property to another investor, or if they do not wish to deal with the owners of pre-foreclosure properties themselves, can use it to obtain a distressed property and still make profit.

Contact the Florida real estate experts if you require more information or wish to discuss assignment of contract in more detail.