A remittance clause in a dispo JV agreement worth flagging before signing
A JV structure for dispo splits comes up often enough to be worth examining closely. The typical setup: a wholesaler contracts the property, a dispo partner brings the buyer, and the fee splits 60/40 to the wholesaler. Straightforward on its face. A common clause then routes the entire assignment fee to the wholesaler at closing, who is obligated to remit the dispo partner's share within 10 business days. That means the party who did the buyer-facing work sees the full amount land in someone else's account first, with no provision for what happens if remittance does not occur, no interest for late payment, no escrow arrangement, and no right to be named on the settlement statement. In practice the dispo partner becomes an unsecured creditor of someone they may have only recently met. The alternative worth knowing about is naming both parties directly on the closing statement so title disburses to each independently. That structure is generally available at most title companies and removes the single point of failure entirely. Where the 10 day remit clause persists, it is usually less because the clean version is unavailable and more because nobody on the dispo side asked for it. Worth asking every time rather than assuming it is off the table.
