Wholesale Deal Trouble

[Lekisha Cole]

I have a wholesale deal I'm trying to close but the seller is asking for a 2% deposit to hold the home. I don't have the 2% to give him and I never knew that I had to give the seller that much of a deposit for him to sign the purchase and sell agreement. What can I tell him for him to sign the contact without any money down?

[John Hyatt]

Hi Lekisha,

The seller can ask for whatever they want and so can you, that’s the cool thing about real estate. I don’t know all the details, but you could always counter and explain why they should use you and how you should be charging them. It is all a matter of perspective, I will never forget the day my mind was opened up to another level of thinking. I processed short sales for several agents in Arizona and one in particular was the top 1% of short sale agents he had nearly 30-50 short sales at any given time going on. Most agents would explain why the client should use them and try and sell them on why they should use them. This guy the top 1% agent instead charged the sellers $500 just to even take their listing!! A little off topic, but the point I am trying to make is you never know if you don’t ask. You are a professional wholesaler who gets deals done quick, they shouldn’t be charging you! You should be charging them or at least they should be thanking God that he sent someone like you to help them sell their property quickly!

My suggestion: it may be too late on this deal, but take a binder with testimonies and keep track of all your stats and deals and make it to where the seller is essentially begging you to work with them. You only have so much time and you can only take so many deals, make sure the client is someone you want to work with. I would explain to the seller what you can do for them, why they shouldn’t be charging you (you are offering to help them for free – you are marketing their property for free), and if they insist on charging you I personally would just walk away. Usually, if they are a problem up front they are a problem throughout and even after it closes.

-John