Our approach to legal protection and disclosure actually originated from the requirements set forth by Alabama’s State Bill 228, which mandated more comprehensive disclosures in real estate contracts.

In every single A-to-B contract we sign, we include clear, explicit language stating our intentions. The contract specifies:

“As the buyer, our company is involved in the buying, selling, renting, and trading real estate for profit. We intend to purchase the property with the likelihood of either reselling or assigning our equitable interest in the contract to another party for a profit. We further clarify that this transfer of interest may occur through assignment, novation, or similar methods.”

This wording was carefully crafted and refined through consultations with three different attorneys in Alabama. As the draft went back and forth among them, the language became more precise and comprehensive, eventually becoming a key part of every contract we use.

Interestingly, despite the detailed disclosures, we’ve experienced virtually no pushback. Over the past year alone, we’ve completed many deals using this language without any significant issues. Perhaps one homeowner reached out with questions, but we haven’t had a single deal fall apart because of these disclosures.

To ensure ongoing transparency, once we find a buyer for a property, we send an email to the seller informing them that we are no longer the buyer. We explain that we’ve found another buyer and that we’re transferring the contract to them. We also reassure the seller that we will continue to manage the transaction all the way to closing. Along with this notification, we provide a FAQ document addressing common concerns, such as whether the closing will still happen on time.

Even though these procedures were initially implemented to comply with Alabama’s regulations, we’ve found that applying them has been beneficial. The added transparency has led to a better relationship with sellers. Many have actually responded positively, thanking us for being upfront and appreciating the clear communication.

As always, consult your own attorney for legal advice to make sure you have the legal protections in place on all offers you write.