Flipper/Rehabber · Canton, MA · Member since 2016 · 9 posts · 6 votes
I started flipping homes last year and have become good at it. Here is my current situation. I have found more homes than I can afford. I have never wholesaled before and want to wholesale one of these.
(1) I am afraid of signing a P&S and then not finding a buyer, although I am in discussions with 2 potentials.
(2) The seller (executor of his father's estate) is selling it to me, knowing that I am going to flip it. But I never mentioned anything about assigning it to someone else. I'm concerned he will feel I'm 'pulling one over on him,' since most laymen have never heard of wholesaling.
(3) And what if I don't find a buyer. Then he will feel I wasted his time.
(4) Plus, just to confuse matters - I am a newer Realtor and, of course, do not want to do anything unethical. Any help on any of these concerns would be greatly appreciated.
Investor · Las Vegas. Jacksonville, Bay Area Ca, Nv, Ca, Fl · Member since 2015 · 511 posts · 220 votes
9y
All money is not good money! You have to go at a pace you can keep up with. You should explain to the seller the same way you are putting it here on BP and give the seller a opportunity to make the decision if he should have you find a buyer for the deal.
Investor · Las Vegas. Jacksonville, Bay Area Ca, Nv, Ca, Fl · Member since 2015 · 511 posts · 220 votes
9y
All money is not good money! You have to go at a pace you can keep up with. You should explain to the seller the same way you are putting it here on BP and give the seller a opportunity to make the decision if he should have you find a buyer for the deal.
Wholesaler · Dayton, OH · Member since 2016 · 252 posts · 227 votes
9y
@Renee Tepper If the deal is good enough that you would buy it at the price that you will be wholesaling it, then you shouldn't have a problem finding a buyer.
You should definitely be upfront with the seller about your intentions. Tell them that you are either going to fix it and flip it yourself, or you may pass it along to a partner, but either way, his price will stay the same, as will the closing date, etc. Give yourself a good 30 days or so on the contract in case of delays or trouble finding a buyer, etc.
Worst case scenario you can always just assign it to someone else at the same price you have it under contract for. Even though you won't make anything, at least you can help the seller get it sold and honor your agreement.
You are in a unique situation in that you have your real estate license. I began my career wholesaling and then later on got my r/e license and it changes your required disclosure quite substantially. @Steven Leigh makes an excellent point about being completely upfront with the seller and I 100% agree. It seems likes you are knowledgeable and can really help this seller out so why not come to an arrangement where everyone benefits. As you pointed out in point #2, this is probably a very emotional time for the seller and if he ends up feeling like 'you pulled one over on him' it could end up with a phone call to the Ethics committee of your real estate board.