1st Wholesale Deal. Help!

[Laura Verderber]

Hey fellow investors. This is my first wholesale deal and I need help! It's 4242 Bit and Spur Road Mobile, AL 36608. It's in Springhill. It's a 3/3 that could be turned into a 4/4. It's got a carport, patio, and double garage. Got it under contract for $400,000. ARV $650,000. I signed a standard real estate contract and added that the contract may be assigned. The seller agreed but requested that proof of funds would be shown so that she'll know the buyer can close. What are my next steps? How do I get an assignment fee? Do I refer a potential buyer to the real estate agent so they can inspect the property? Let me know what you think.

[Tim Delaney]

@Laura Verderber I just looked up the house on Zillow, it is listed at $400k after a price cut of $45k. That means that other investors most likely have already seen this and passed on it. Wholesaling tends to work better with off market deals.

In wholesaling you make your fee at closing by getting someone else to pay more for a property than you have it under contract for. So if you can get someone to pay $425k in this scenario then you get a $25k fee at closing.

As for the proof of funds, as an ethical wholesaler you should be prepared to close on this house if you cannot find a buyer. So you should show your proof of funds when you put it under contract. If you have experience flipping then you should have a solid rehab budget and if you expect the deal to work for someone paying more than $400k then it should definitely work for you at $400k.