Can seller do businesses with wholesale

5 Replies

Ok, so there a house thats in a 176k area house caught in fire . And is listed with agent . Question is CAN I THE WHOLE SELLER still make an offer ? I’m sure the deal won’t go as smoothe as just dealing with home owner.

@Carlos Pena Yes, a lot of wholesalers get their homes from the MLS. My suggestion is that you contract it for far below the list price because when you turn around to flip it off to another investor they are going to figure out pretty quick what that list price is. I would suggest offering 10% or more below the list and then try and flip it for 3% - 5% below list. If you offer it at list or above, you may have all your investors just wait for it to go back on the market if you aren't able to close the deal.

You will probably end up needing to do a double close when you buy like this and won't be able to just assign the contract.

@Carlos Pena No, double close because when an agent/broker sees a contract with an assignee clause they get nervous and will sometimes advise against accepting the offer. A double close used to require a bridge loan and may still in your state but in Texas it is typically done seamlessly on the same day. Essentially the house is sold to you and then you sell the house to the investor all on the same day. The closing company/law firm will handle all the paperwork and get your your payout. Most should be familiar with how to do a double close and will walk you through it. You don't need to worry too much about that.

Benefits of assigning: You get your fee and walk away, Super easy and clean for you

Benefits of double close: Your investor will never know what you are actually making on the deal

It depends. Most wholesalers in Texas that I have come across will pass all closing fees on to the buyer, that is fees for the homeowner, for the wholesaler, and for the buyer. This is common here but I am not sure about all over the country. The wholesaler is only out the earnest money and option fee/due diligence fee that is paid up front. Typically the wholesaler will take an earnest money deposit from the buyer to cover what they already put into escrow for the homeowner. Basically the wholesaler doesn't pay anything but they do front a very small consideration that is paid back at the time of sale. Earnest money can be as little as $100 or even less.

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