Words with attorney

[jseamless 0]

I am thinking of placing a property under contract (option to purchase)

 

I spoke to attorney and he said yes you are acting as a principal but you are in gray area because you really intend to assign your interest immediately. I do see both sides of the point.

 

How do you make sense of this? Can you recommend any reading material to clarify this issue?

 

Joshua

[-Tony- 0]

the way I see it, when I use a straight option or l/o I put $1.00 down and I have

1. a monetary interest in the house

2. I have the right to do with anything I want too with something I have a vested interest in

 

Ask you layer if he can sell the Porche he drives if he leases it. I'll wait

 

did he put money down on it?

 

What did he say?

[MichaelC 160]

I spoke to attorney and he said yes you are acting as a principal but you are in gray area because you really intend to assign your interest immediately. I do see both sides of the point.

I don't, Joshua. If you are a principal and the contract gives you the right to sublet the property or assign the deal, there is no gray area.

How do you make sense of this?

Another well meaning attorney who is not an investor himself, and would rather take a conservative approach to all things that aren't easily bracketed. Better to err on the side of caution, is his thinking I suppose.

[jseamless 0]

Thanks for the feedback! For example if you did a Cooperative Assignment. You and the owner know that this could be construed as brokering the deal? How can you justify position and not look like a broker?

[MichaelC 160]

Simple, Joshua. You have an agreement with the homeowner which contains a clause that states you may sublet or assign the deal. Thus, you are a principal in the deal. You are not brokering the deal.