Unique Wholesale Scenario

[John Chan]

Hey guys, help me structure this deal here:

I have house under contract for 25k. Needs repairs 15k. Worth 80k.

I was going to wholesale this house for 28.5k via double-closing. However, a legitimate buyer has offered 32k if I close the house first (own it myself) and then close with him 2 months later because he has to liquidate some of his investments to buy this house cash. He wants to lock it up under contract before April 30th and close right before June 30th so he can get the tax credit.

Should I just ask for a non-refundable earnest money up front, then the balance at closing? You guys think I should ask him to pay my holding costs for the 2 months I would hold it? Should I let him in the house to do the needed repairs while he is under contract with me? Any other suggestions? Thanks guys.

[Andy J.]

This is not a good idea. Odds are they will not end up purchasing the property from you, your holding costs will be expensive, and closing costs must be taken into consideration as well. All to make $3.5k, wholesale it to someone who is serious or get a very large option consideration up from, non-refundable of course.

To qualify for the tax credit you must be under contract by the end of April and close before the end of June, both criteria must be met. "Choose" would correlate to "under contract" Mr. Jacobs.