The Best Assignment Contract Template

If you're interested in becoming a wholesaler or doing more wholesale deals, then you're going to need the right assignment contract.

That's right — not any assignment contract will work.

To protect yourself and your investment, you need an assignment contract that has everything spelled out, from the parties involved to the purchase price, assignment fee, terms and conditions and more.

Where can you find the best assignment contract?

If you're looking to learn more about an assignment contract in real estate or an assignment contract template, keep reading!

What is an Assignment Contract in Real Estate?

In simple terms, a real estate assignment contract is an agreement where the original buyer of a property (known as an assignor) gives their contractual rights via a contract to someone else (the assignee) — for the price of an assignment fee.

Assignment contracts don't include the direct transfer or sale of property, as a purchase agreement does.

You may be wondering...

How Much is an Assignment Fee?

An assignment fee can vary from property to property. For example, a general standard assignment fee is $5,000 per contract.

That being said, the assignment fee can instead be a percentage of the purchase price or another pre-determined amount.

For example, let's say you as a wholesaler obtains a contract to purchase a property at $200,000. You then find a cash buyer who will buy the contract for $225,000.

That's a profit of $25,000 (and much more than the standard rate of $5,000)!

Key Elements of an Assignment Contract

What should an assignment contract include?

It's important to have a carefully worded contract to ensure both its validity and enforceability.

These elements typically include:

1. Parties involved: In the assignment contract, clearly identify the assignor (original buyer), the assignee (buyer replacing the assignor), and the original seller.
2. Property description: Provide a detailed and accurate description of the property being assigned, including the address, size, and any features that make the property unique.
3. Purchase price: To ensure transparency, specify the agreed-upon purchase price between the assignor and the assignee.
4. Assignment fee: State the amount of the assignment fee to be paid by the assignee to the assignor for transferring the contract.
5. Necessary terms and conditions: Outline the terms and conditions of the assignment, including any contingencies or conditions to be satisfied.
6. Signatures: Both the assignor and the assignee, along with any necessary witnesses, should sign the contract to make it legally binding.

Assignment Contract Template

_______________________________________("Assignor") does hereby assign unto __________________________________________ ("Assignee") and Assignee does hereby assume and accept all rights, title and interest to that certain purchase contract for real estate (the “Contract”) concerning the real property located at: ________________________________________________ APN_____________ (the "Property") for a purchase price of $__________________ (the "Assignee Purchase Price"). 

The difference between the Assignee Purchase Price and the purchase price by which Assignor contracted to purchase the Property shall constitute Assignor's "Assignment Fee" and shall be paid to Assignor by Escrow Agent upon close of escrow. Escrow for the Property is held at __________________________________ ("Escrow Agent"). Assignee agrees to deposit $5000.00 as nonrefundable earnest money with Escrow Agent within twenty-four (24) hours of this fully executed Assignment ("Assignee Earnest Money"). 

The Assignee Earnest Money may only be returned to Assignee in the event the Seller is unable to deliver clear title to the Property on or before the close of escrow date or if Seller otherwise breaches the Contract. 

The Assignee Earnest Money shall be credited towards the Assignee Purchase Price at close of escrow. Assignor makes no representations and warranties of any kind whatsoever incident to this Assignment and the Property. 

Assignee hereby represents, warrants, covenants, and agrees and acknowledges that it has made or will make such investigations as it has deemed or may deem necessary with respect to the Property and Assignee has entered into and will consummate the transaction contemplated by this Assignment on the basis of such investigation and not on the basis of any representation or warranty made by Assignor or any employee, agent or representative of Assignor.

Except as expressly set forth in this Assignment, Assignee agrees that Assignor shall not be responsible for or liable to Assignee for any defect, error or omission or on account of any other condition affecting the Property, and that Assignee is accepting this Assignment and purchasing the Property “AS-IS”, “WHERE-IS” and “WITH ALL FAULTS”, as of the date of this Assignment. 

Assignee hereby relinquishes, waives and releases all rights and claims that the Assignee may have now or may have in the future against the Assignor and any employee, member, manager, agent or representative of Assignor whether known or unknown arising out of this Assignment or related to the Property.

The Assignee also releases and forever discharges the Assignor and any employee, member, manager, agent or representative of Assignor from any and all claims which Assignee may hereafter have for damages of any kind or nature, and all other incidental expenses or losses which may arise out of or result from Assignee's purchase of the Property. 

Assignee will indemnify, defend, protect, and hold harmless Assignor and any employee, member, manager, agent or representative of Assignor from all claims, demands, or liability arising out of or encountered in connection with the transaction contemplated by the Assignment and the Property. 

Assignee assumes and accepts all rights, obligations, and responsibilities of the Contract and agrees to close escrow on or before 5:00 pm on ______________________. 

If Assignee fails to deliver all funds, to execute all documents and to take any other actions necessary close on or before 5 pm on ______________________, all right, title and interest in and to the Contract shall immediately transfer back to Assignor. 

If Seller fails to deliver clear title to the Property by close of escrow, or Seller otherwise breaches the Contract, all right, title and interest in and to the Contract shall transfer back to Assignor upon Assignor's refund of the Assignee Earnest Money to Assignee. 

Notwithstanding any other provisions contained herein, Assignor retains the right, prior to close of escrow, to pursue any and all legal remedies, if necessary, in the name of Assignor to enforce the Contract. 

2 Assignee understands, acknowledges, and agrees that the Seller may leave behind personal items or garbage on the Property and that Assignee will be responsible for clearing and removing such items from the Property. _____________ Assignee Initials Assignee understands, acknowledges, and agrees that the Property is being purchased "subject to" Seller's existing loan(s), which are secured by deeds of trust against the Property. 

This means that the existing loan(s) will not be paid off and the deed(s) of trust will remain as liens against the Property upon the close of escrow. 

The deed(s) of trust contain due on sale clauses, which allows the lender(s) to call the existing loan(s) upon transfer of the Property by the Seller. 

Foreclosure proceedings will be initiated in the event the lender(s) invoke the lender(s)' rights under the due on sale clause. Assignee understands, acknowledges, and agrees that in this event, Assignee will need to assume the existing loan(s) or pay off the existing loan(s) to avoid losing the Property to foreclosure. 

_____________ Assignee Initials 

Assignee understands, acknowledges, and agrees that Assignee is assuming all obligations of the Assignor under the Contract and shall conform with all terms of the Contract. 

_____________ Assignee Initials 

Executed ______________________, 20___

Frequently Asked Questions about Assignment Contracts

Here are answers to some frequently asked questions about assignment contracts in real estate.

Q. When can you not use an assignment contract?

There are instances where you can't do contract assignments, including with short sales or REOs. In either of these scenarios, instead of using an assignment contract, you can use a double closing.

Q. Can an assignment contract be revoked?

In general, an assignment contract can be revoked in the event that both parties agree to terminate the assignment — and mutually release each other from the contractual obligations.

The Bottom Line: Assignment Contracts

There you have it: an assignment contract.

A well-written assignment contract is a vital part of any real estate business.

Without one — or a poorly worded assignment contract — your business and your profit can be at risk.

Use this assignment contract to ensure safety and profitably in your next wholesale real estate deal.

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