Can you wholesale a wholesaling property?
hi group,
Has anyone ever wholesaled a wholesaling property?
Most Popular Reply
@Lian Shi don't do it!! Try to either get your split from all parties involved. For example,
Wholesaler A has the property(contract price 90K, wholesale price 100k). Wholesaler B works out an agreement to go into a JV with Wholesaler A and will market the property to his buyer's list. **Note** - Wholesaler B needs to have some type of agreement (written/verbal) with Wholesaler A to do this.
Meanwhile you, Wholesaler C, see the property (by way of Wholesaler B) and want to wholesale it to your buyer's list or you have a buyer in mind. Wholesaler B tells you to tack on $1000 or so to the original price. Your price to your buyer is 101k.
Here is the daisychain: Wholesaler A (property) ---> <---Wholesaler B (Buyer) <----Wholesaler C (Buyer).
Wholesaler A & B split $10000, Wholesaler C gets $1000, and everybody is happy,...or not.
Problems arise with this arrangement, such as: trying to schedule property viewings through all parties involved can be tedious; everybody using different contracts; investor friendly title companies not wanting to do a daisy chain; buyer insists on using their title company and their title company won't do the deal; title company explaining all the contracts to the seller at the closing table and the seller backs out because they don't understand what's going on & feel like they are being ripped off; etc, etc.
People do it, but I no longer do it.
I either agree to a JV with the original wholesaler or I just pass on the deal. There will be another one.
Yes, it can be done, but it can get messy.
My 2 cents.