02/27/2026 — Deal Desk: Solving Real-World Novation Challenges

On this Novation Call, members worked through live deal scenarios to troubleshoot real-world structuring, lender, and contract risks that can make or break a novation. The discussion focused on protecting your position, managing seller expectations, and navigating financing hurdles—especially in complex multi-unit transactions. Participants gained practical strategies to increase profit while reducing legal and execution risk.

• Novations create higher profits by replacing the A→B contract with A→C while you assume marketing and repair risk — positioning is key to seller acceptance.
• Anchor with a cash offer, then pivot to a higher-price novation framed as an upgraded solution (e.g., Equity Protection Program).
• Contract timelines must align — mismatched dates are one of the most common deal killers.
• Protect your position by recording an Affidavit of Option to establish equitable interest and prevent seller bypass.
• Seller must sign all documents directly — Attorney-in-Fact signatures often fail lender review.
• Transparency with agents and lenders helps deals pass the “sniff test” and close smoothly.
• FHA fourplex deals carry major risk; pivot to conventional financing or consider a double close when possible.
• Pre-inspections reduce surprises and identify financing issues early.
• New FinCEN reporting rules increase compliance requirements for cash transactions — coordinate closely with title companies.