"What is your fee?" and response
Hi everyone, just quick question here. If I am not doing an assignment and instead plan on doing a back to back closing using transactional funding for my A-B close, when I am advertising to my end buyer I sometimes get asked "what is your assignment fee?" Do you just respond with "everything is included in my price". I just hate that awkward moment. This is only for those deals where you stand to make significant profit over 10k or so that I am referring to. Any answers are appreciated.
I have margins built into my offer so when I show them their costs. It's tied in. I make NET offers not Sale price offers.
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Using funding in you A-B means you take title, that means you're not assigning anything, you're selling. You don't have a markup, you have an asking price.
Then, when they ask what you bought it for, I ask "how does that effect the price of beans in China?" The value of the property has nothing to do with what an owner paid for it. (In that type of transaction). :)
I agree w/ Bill. I just tell them if the price works for them, then it works for them. If it does not, then they don't have to buy the property. I've only double closed a hand full of properties. I've had assignment fees as high as 40k and did not double close.
Originally posted by @Ryan Miller:
I agree w/ Bill. I just tell them if the price works for them, then it works for them. If it does not, then they don't have to buy the property. I've only double closed a hand full of properties. I've had assignment fees as high as 40k and did not double close.
Wow 40k on a single deal thats awesome!. Can you share some details about that transaction? Just curious to know Im just getting started on wholesaling and have yet to make my first deal.
Ha, I don't assign, but my guy tells me what he's making and I couldn't care less as long as I hit my numbers. In fact, he usually tries for way more than I'm willing to pay so I set the price more often than not. What Bill said is accurate, though. If you are closing on the buy, you are a seller, not an assignor.
I'd probably balk at $40k, though, unless it was a higher end property. Thats a lot in the $200k houses I play in, not so much if its a $1.6 mil deal in California. That's pretty awesome for a wholesale, btw, I don't make that on half my rehabs.
Originally posted by @Josselyne Lugo:
Originally posted by @Ryan Miller:I agree w/ Bill. I just tell them if the price works for them, then it works for them. If it does not, then they don't have to buy the property. I've only double closed a hand full of properties. I've had assignment fees as high as 40k and did not double close.
Wow 40k on a single deal thats awesome!. Can you share some details about that transaction? Just curious to know Im just getting started on wholesaling and have yet to make my first deal.
It was a hot area, and the seller named his price. I agreed and someone offered me that much more. I've had a couple close more more than that, but I did double close on those deals. Trust me it's rare, and I don't "try" for those kind of spreads, but if the deal is right for the investor, and for the seller then everyone wins.
Originally posted by @Darrell Shepherd:
Ha, I don't assign, but my guy tells me what he's making and I couldn't care less as long as I hit my numbers. In fact, he usually tries for way more than I'm willing to pay so I set the price more often than not. What Bill said is accurate, though. If you are closing on the buy, you are a seller, not an assignor.
I'd probably balk at $40k, though, unless it was a higher end property. Thats a lot in the $200k houses I play in, not so much if its a $1.6 mil deal in California. That's pretty awesome for a wholesale, btw, I don't make that on half my rehabs.
It was a rare deal for sure.When it came down to it, the buyer knew he could not get another property in that area, and he was still going to make money on his end when he flipped it.