Wholesale Assignment of Contract

2 Replies

I am in the process of purchasing a property via a wholesaler. This is the first time working with them or any wholesaler in general. What should I be on the lookout for to make sure I am not getting scammed?

@Varun Patel ,

Just as you would purchasing from anyone. Do your due diligence. You need to assess the property's ARV, estimate your rehab costs (assuming you're rehabbing), and negotiate a price with the wholesaler.

Unless he doesn't have the property under contract, he can't really scam you.  You can agree to take over the contract, but if it turns out he doesn't have one, you would just end up walking away.

If he has it under contract for $100, and you purchase it for $100,000, you might not be happy, but you shouldn't let that get under your skin.  For you, what's important is if the $100,000 purchase price works for you.

@Varun Patel

Know your market and run your own numbers. Remember he is a salesman, trying to sell you a property. Make sure that you know how much your repairs will be (from your own experience or contracts), and don't count on his estimates on repairs or ARV. If you have a relationship with a Realtor, ask them their thoughts!

Is the property in a decent area for resale or rent (if you are planning to hold). Make sure that you have contact with the title company. 

Good luck!