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Wholesaling

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Bill W.
  • Real Estate Investor
  • Austin, TX
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What prevents a buyer from circumventing wholesaler?

Bill W.
  • Real Estate Investor
  • Austin, TX
Posted Feb 11 2013, 12:01

If I put a home under contract and intend to wholesale the property, what prevents an unscrupulous buyer from intentionally tying up the home, backing out of the purchase during the option at the last moment, and then buying it directly from the seller a short time later after it falls out of contract with the wholesaler?

If a buyer used the option period and backed out, it seems there is a good chance a wholesaler wouldn't have time to have another buyer purchase the home during the wholesaler's option period. In an event like that, couldn't the buyer purchase directly from the seller less the wholesale fee?

Other than getting a lousy reputation, what prevents a buyer of a wholesale deal from doing this?

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