With many new construction condo units coming online and due to be completed in the relatively near future, your new condo buyers may be faced with a situation in which their circumstances have changed and they may not be able to close, or they may wish to sell and make a profit. In either case, they may wish to assign their agreement. You may also have a buyer looking to buy in a sold out building before it’s completed.
It must be kept in mind that assignment agreements are very complex and should be handled accordingly. Before taking a listing for assignment sale, the following information should be ascertained:
Will the builder allow the assignment of this agreement?
If so, is there a charge?
If there is a charge, how much is it and is your client willing to pay it?
If the assignment is allowed by the builder, does the builder need to approve the assignee?
How long will that approval take?
If the builder allows assignments, do they allow them to be marketed on MLS? (they often do not allow them to go on MLS)
Once it has been determined that the agreement may be assigned and marketed on MLS and the listing has been loaded, the Remarks For Brokerages should indicate that this is an assignment and the seller is selling his/her interest in the Agreement of Purchase and Sale. Any offers should be on an Assignment of Agreement of Purchase and Sale form (#150 for condos). It should be noted that the original APS (between the builder and the Assignor) will have to be attached as Schedule C to the Assignment Agreement.
Please also note that the calculations on Schedule B of the Assignment Agreement can be very tricky and somewhat confusing. Please don’t hesitate to reach out to me with any questions. I would be only too happy to review your offer before you have your buyer or seller sign it. I would also strongly recommend you make your offer conditional on your client’s lawyer’s review and approval.