Lesson 4 of 5
Contract, title and assignment basics
The paperwork stage is where beginners lose deals and occasionally get sued.
10 min read
What a purchase agreement must contain
Parties exactly as they appear on title, the full legal property description, price, earnest money, closing date, who pays what at closing, an inspection or due-diligence period, and your right to assign. Attorney-prepared state-specific forms only. Do not run a borrowed PDF from a course.
Inspection periods are not free options
A due-diligence window exists so you can verify condition and title, not so you can shop the contract with no intent to close. Using it as a no-risk option is how wholesalers earn a bad name locally, and in several states it is now regulated.
Title is the real gate
Open title the day you sign. Liens, unpaid taxes, code violations, probate, a missing heir, a divorce decree, an unreleased mortgage — all of it surfaces here, and all of it takes time you have not yet budgeted. Work with a title company or attorney who has closed assignments before and will say so plainly.
Assignment versus double close
An assignment transfers your contract for a fee that appears on the settlement statement. A double close is two transactions and hides your spread but costs more and needs funding. Choose based on state rules, the size of the fee and what your title company allows. Disclose the assignment to the seller.
Do this next
- Get one state-specific assignable purchase agreement reviewed by a local attorney.
- Call two title companies and ask directly whether they close assignments.
- Write your standard earnest money amount and where it is held.
Education only — not legal, tax or investment advice, and no promise of income. Rules differ by state; check yours and use a real estate attorney.