165k assignment fee moved into a consulting agreement dated the day before closing
I'm looking at funding the buyer side on a distressed estate assignment, 2.3M contract, and the package I was sent has the fee structured in a way I don't understand the purpose of.
The assignment agreement itself shows a $10 consideration. The 165k shows up in a separate consulting agreement between the buyer's LLC and the assignor's LLC, dated the day before closing, described as "acquisition advisory services." No scope, no deliverable, no hours. Wired outside of escrow. Nothing about the 165k appears on the settlement statement, and the seller's estate signs nothing that references it.
There's also an addendum giving the assignor the right to "market the property and assign this agreement to any party at its discretion." The seller initialed that one, which is the only place the concept shows up at all.
What I'm unsure of: whether the split is doing something for tax, or for the seller's benefit, or for the assignor's exposure if the estate's heirs ever ask what the middle party made. What worries me is that a payment invented to sit outside the transaction tends to be the payment someone regrets later, and I'd be the one with money in the room.
I'm having a real estate attorney in the state read it before I move, since disclosure rules and what has to hit a settlement statement differ state to state. In the meantime, if you've seen this structure work for an ordinary reason, I'd like to hear it, because right now I only see reasons I don't like.