Updated June 22, 2023
A purchase contract assignment is between a holder (assignor) that transfers their interest in buying real estate to someone else (assignee). Before the closing, it is common to assign a purchase contract to a business entity or the person whom the loan or mortgage will be under. It’s also accepted for a contract holder to sell their rights to buy a property for a fixed amount.
Seller’s Consent
Depending on the purchase contract signed between the seller and assignor, the seller may be required to give their consent before the agreement is legally valid.
Table of Contents
2 Versions
Simple Version – Use when a purchase contract is being assigned to an entity that is owned by the buyer.
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Advanced Version – Use when a purchase contract is being purchased and assigned to a 3rd party.
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How to Assign a Purchase Contract (4 Steps)
This guide is for assignments when selling a purchase contract to a 3rd party.
- Step 1 – Come to a Verbal Agreement
- Step 2 – Share the Purchase Contract
- Step 3 – Create an Assignment
- Step 4 – Attach and Close
Step 1 – Come to a Non-Binding Agreement
The buyer (assignor) in the original purchase contract and the new buyer (assignee) will need to come to an agreement. In most cases, the assignee will offer a fixed amount to buy the contract.
Step 2 – Share the Purchase Contract
The assignor may need to require the assignee to sign a non-disclosure agreement (NDA) as the details included in the purchase contract are confidential.
After signing the NDA, the assignor should share the purchase contract with the assignee.
Step 3 – Create an Assignment
After the purchase contract is shared an assignment should be written and signed. If there is a payment as part of the assignment, it should be paid at the time of signing.
If the seller’s consent is required, the assignment will need their signature to be valid.
Step 4 – Attach and Close
After the assignment is signed, it should be attached to the original purchase contract. The assignee will be recognized as the buyer and will be required to close on the property in accordance with the terms of the purchase contract.
Sample Purchase Contract
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REAL ESTATE PURCHASE CONTRACT ASSIGNMENT
I. THE PARTIES. This Real Estate Purchase Contract Assignment Agreement (“Agreement”) is made on [EFFECTIVE DATE] (“Effective Date”) by and between:
Assignor: [ASSIGNOR’S NAME], (“Assignor”) with a mailing address of [ADDRESS], hereby transfer and assign to:
Assignee: [ASSIGNEE’S NAME], (“Assignee”) with a mailing address of [ADDRESS], that agrees to assume all rights and interest in a purchase contract between the Assignor and:
Seller: [SELLER’S NAME], (“Seller”) with a mailing address of [ADDRESS], for a purchase contract dated on [DATE] (“Assignment”).
The above-referenced Assignor and Assignee may each be referred to as a “Party” and collectively referred to herein as the “Parties.”
II. THE PROPERTY. The Assignment is regarding real property located at the following street address: [ADDRESS].
Additional Description: [ADDITIONAL DESCRIPTION].
III. TRANSFER. The Parties agree that the Assignor is transferring the Assignment to the Assignee for the following:
☐ – Fixed Payment of $[AMOUNT] (“Payment Amount”). The Assignment is to be transferred in exchange for the Assignee paying the Assignor the Payment Amount within [#] days of the Effective Date.
☐ – No Payment. The Assignor is transferring the Assignment for no payment or compensation. The Assignee’s consideration shall be recognized as the undertaking of any liabilities or obligations in the Assignment.
☐ – Gift. The Assignor is granting the Assignment as a gift to the Assignee.
☐ – Other. [DESCRIBE OTHER]
IV. SELLER APPROVAL. For this Agreement to be in effect: (check one)
☐ – It is REQUIRED for the Seller to approve this Agreement within [#] days of the Effective Date. If the Seller does not approve this Agreement or fails to sign, this Agreement, then this Agreement shall be considered void.
☐ – It is NOT REQUIRED for the Seller to approve this Agreement. Upon the execution by both Parties, this Agreement shall be in full force and effect.
V. ASSUMPTION. The Assignee acknowledges and agrees to assume the transfer and ownership of all liabilities, obligations, and claims that currently exist or may in the future regarding the Assignment. As of the Effective Date, the Assignee agrees to comply with all terms, make all payments, and perform all the conditions, covenants, and any other duties as part of the Assignment.
VI. PARTIES’ REPRESENTATIONS. The Assignee acknowledges that they have a full understanding of the Assignment and the terms of this Agreement. The Assignor further warrants that they own the rights transferred in the Assignment and understand the terms of this Agreement. Both Parties agree to provide and complete any obligations under this Agreement or the Assignment.
VII. SEVERABILITY. If any term, covenant, condition, or provision of this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of the provisions shall remain in full force and effect and shall in no way be affected, impaired, or invalidated.
VIII. GOVERNING LAW. This Agreement shall be governed under the laws located in the State of [STATE].
IX. WAIVER. The failure of either Party to enforce any provision of this Agreement shall not be deemed a waiver or limitation of that Party’s right to subsequently enforce and compel strict compliance with every provision of this Agreement.
X. ADDITIONAL TERMS. [ADDITIONAL TERMS]
XI. ENTIRE AGREEMENT. This Agreement constitutes the entire Agreement between the Parties. No modification or amendment of this Agreement shall be effective unless in writing and signed by both Parties.
Assignor Signature: ____________________________ Date: _____________
Print Name: ____________________________
Assignee Signature: ____________________________ Date: _____________
Print Name: ____________________________
Seller Signature (if required): _______________________ Date: _____________
Print Name: ____________________________
How to Write
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Section 1 The Parties
(1) Effective Date For Purchase Contract. The calendar date considered the first day of this document’s effect on the Parties involved must be established in the first section.
(2) Assignor Of Real Estate Interest. The Party who shall release his or her interest on the concerned real estate upon the satisfaction of this agreement’s conditions must be identified with a record of his or her full name and mailing address. If Assignor is a Business Entity then make sure the name recorded is its entire legal name.
(3) Assignee Of Real Estate. The Party that will be able to express a rightful interest or claim on the real estate or real property through this document will need to be named. This will require a record of his or her name and address. Bear in mind, a Business Entity acting as the Assignee must have its legal identity including status suffix (if any) produced.
(4) Seller Of Real Estate. The Property Owner or the Party selling the concerned real estate requires his or her name presented.
(5) Date Of Purchase Contract. Furnish the time and date of the original purchase contract this agreement concerns.
Section 2 The Property
(6) Property Location. The concerned real estate must have its physical address (where it may be visited in person) documented.
(7) Property Description. In addition to the location of the concerned real estate, it is recommended that an adequate description be provided. For instance, define any type of structure on the property (i.e. residential building, office building with parking lot, etc.). Ideally, the property’s legal description can be reported here or attached to this agreement.
Section 3 Transfer
(8) Fixed Payment. The manner by which the Assignor releases his or her interest over the concerned real estate to the Assignee will need to be discussed in this paperwork. If this transfer of interest results from a payment from the Assignee to the Assignor then mark the “Fixed Payment” checkbox (found in the third section). This statement will require the exact “Payment Amount” and the maximum number of days after the Effective Date when this payment must be received from the Assignee in order for it to be on time and in compliance with this agreement.
(9) No Payment. Select the second checkbox if “No Payment” will be required of the Assignee to assume the real estate interest being discussed from the Assignor.
(10) Gift. If this transfer of interest is considered a gift from the Assignor to the Assignee then select the “Gift” checkbox.
(11) Other. There may be other circumstances or conditions the Assignee and Assignor have agreed to fulfill for this assignment to occur. For instance, the release of interest may be dependent on the termination of the Assignee from a shared Business Entity with the Assignor. In any case, if none of the statements made in the third section accurately define the basis for this assignment, select the “Other” checkbox and provide this definition to the space available.
Section 4
(12) Required Seller Approval. This agreement has thus far dealt with the Assignor and the Assignee. If the Seller of the real estate must approve this assignment then the first statement made in Section IV should be selected and a report the number of days within the effective date of this agreement when such approval must be gained (from the Seller) will be required.
(13) No Seller Approval Requirement. Select the second statement made by Section IV if this agreement may require only the consent of the Assignor and the Assignee to be effective.
Section 8
(14) Governing Law. Report the state that will hold authority over this assignment and the agreement being developed.
Section 10 Additional Terms
(15) Remaining Agreement Conditions. All the conditions and the terms that the Assignor and Assignee require to be complied with should be contained within this agreement before it is signed. Section X will supply the space for such information to be presented and will allow the title of additional paperwork that will be attached to be included. This area may be left unattended if the information produced thus far represents the full scope of the obligations each Party must live up to for this assignment to proceed to completion.
(16) Assignor Signature And Date. The Assignor making this assignment should sign his or her name and dispense the date this action was completed.
(17) Assignor Printed Name.
(18) Assignee Signature And Date. The Recipient of this assignment, the Assignee, should review this agreement then sign his or her name. The date of the Assignee signature must also be reported at the time of signing.
(19) Assignee Printed Name.
(20) Seller Signature And Date. If it has been indicated that the Seller must provide consent, then he or she must sign this paperwork upon its completion and a thorough review so that this assignment may proceed. His or her signature date will also be required.
(21) Seller Printed Name.
