Clause 4 of this one page bird dog agreement is doing something odd
A younger cousin is about to start finding houses for a local flipper and sent me the agreement to look at, since reading paperwork is the thing I do. It's one page, which is the first thing that worried me.
Clause 3 is the fee: $1,000 per property that the investor purchases where my cousin "first identified the property to the investor."
Clause 4 says the fee is payable within 30 days of the investor's resale of the property, not the purchase. So he finds a house in March, the investor buys in April, renovates until September, sells in October, and gets paid in November. Eight months of float, and no payment at all if the investor decides to keep it as a rental, because there's no resale to trigger from.
There's also no definition of "first identified." If my cousin sends an address the investor already had in a mail campaign, who wins that argument? Nothing in here says.
What I'd change is obvious to me: pay on the purchase closing, and define identification as the date of a written submission that the investor acknowledges. What I'm less sure of is whether it's worth him pushing back at all on a first arrangement with a buyer who does maybe fifteen houses a year, or whether he takes it as written to get started and fixes it after three deals.
Also worth saying I'm not a lawyer and whether a fee like this is even payable to an unlicensed person depends on the state, which is a question for a real estate attorney where he lives.