Wholesaler versus Real Estate Agent

9 Replies

Hi, I'm new to real estate investment and am planning to invest in SFH or owner-occupied Residential MFH in metro Charlotte. As a "newbie," should I make my first purchase through a real estate agent? I've owned homes in the past so I've worked with real estate agents before. However, I've never worked with wholesalers, and I'm not even sure that I qualify to work with them (for example, I'll be taking out a loan for the purchase rather than paying cash).

Thank you!

What sort of loan are you getting? Conventional lenders don't handle wholesaler deals well. Not impossible, but you may have to put more of your own cash into the deal than with a MLS deal becuase the wholesaler's fees will generally have to be paid with cash.

Wholesalers don't like dealing with conventional lenders, either.  They're slow where wholesalers typically need quick closings.

OTOH, if you're getting a hard money loan it should be OK.

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Well, I'd take a deal any way it comes to me. So, I wouldn't write wholesalers off completely. Just realize its going to be harder to close and the wholesaler will have to be cooperative. If you're up front with the lender and you're willing to pay the wholesaler out of your pocket (though it will still be on the HUD-1) its possible.

@Jon Holdman  Would a real estate agent or lawyer help me navigate/negotiate with a wholesaler, or is this something I will need to do on my own? I ask because I haven't worked with a wholesaler and need to know what to be prepared for.

Thank you.

I wholesale in the Charlotte area as well as flip. My suggestion to you is work with both. If the deal makes sense to you, then it should not matter who you work with. Best of luck.

Hi Joan:

Don't limit yourself! Buy the best deal you find, which is often from a wholesaler.

We wholesale about 8 properties each month to local investors. We always prefer they pay cash, but many get loans which has not been a problem other than the extra time it takes for us to get it closed.

There are a lot of wholesalers in the Charlotte area that would love to work with you. Feel free to email me and I can hook you up!