Real Estate wholesaling

10 Replies

I am interested in the wholesale part of the real estate niche as I have bad credit and no money but I also am a law abiding citizen.  Why are people pushing the double closings if there are legal and accounting concerns from attorneys and title companies; and if that is the case why can't the wholesaler person attend the one closing between the seller and buyer she put together the way a typical real estate agent would.  This is the part i'm not understanding.  

thank you kindly for your time and response.

Generally wholesalers represent themselves as the buyer. So if you show up to the closing table and the seller finds out you are not the buyer, instead you're making a fee, it may not go well. 

I come from a banking background where the numbers must match and you verify the source. What about transparency if you let the seller know you're putting this deal together for them and there is a fee, why would that be a problem?

@Brenda Herman most states require you to have a real estate license to broker real estate deals. If you have no money, you are putting a property under contract that you don't have money to purchase. If you are not a broker, you can't market a property for sale before you own it. So you have no money to buy it and you can't offer it for sale until you buy it (close on it). Double closing is not possible, unless you market the property before you own it. 

If you want to structure it like a real estate agent, just connecting seller and buyer, then getting commission, then you need to be licensed. That requires some classes and a test in most places. The reason is so you are educated on the legal and ethical aspects of selling homes. 

Many wholesalers survive by getting around the rules without getting caught. You can run a hundred red lights and never get pulled over, but that doesn't mean it is legal.