Selling for a Wholesaler/Novation

[Seth McGathey]

Hello, I recently had a wholesaler come to me looking to use me as an agent for his novation. My brokerage seems to be against it saying that it is complicated, risky, and a lot of extra work. Suggesting it is not worth it. Have other agents done this before? Is it is worth it or is my brokerage right? It seems that the guy I talked to was shot down by multiple agents from multiple brokerages. To me it seems like a situation where I could get repeat business if I was the one agent that would take it on. Plus open the door to other other clients if they find out I am the only one in my area willing to do it. Would love to hear from anyone with some experience on these. Thanks!

[Corby Goade]

Nope, don't do it. They're 100% a mess in many ways for agents. 

You have a fiduciary duty to the seller, but the novation contract strips those rights away from them and you'll end up with a seller that is angry with you AND the wholesaler- I agree, lawsuits are inevitable if you take these on and your broker will have no defense. You essentially give up your ability to be a fiduciary when you do these deals and there's no value you can bring to your client, only the wholsaler wins.