Licensed Agent - Wholesale Question

[Tony Clark]

Hi everyone,

I have a very specific question I'm hoping that any of you agents who have been involved in off market deals can help me with - I'm a new agent and I want to make sure that I do everything the right way. My questions pertain to off market deals, wholesaling as an agent, and representing clients on off market deals. Here's a scenario:

A wholesaler brings me a deal and is asking $100,000 including his/her assignment fee -  he/she knows that I'm a licensed agent and that I have a client (or customer) who is interested in purchasing the deal. How do I go about adding my commission on top of the $100,000 purchase price? My understanding is that I need to disclose to both the wholesaler and to my buyer what my commission will be, have already determined agency or facilitator status with my buyer, and then add my commission to the price a give to my buyer before writing an offer for my buyer (and disclose that I am receiving $5,000 commission in the necessary forms). So, I would be marketing the property at a $105,000 purchase price to my buyer. Is that the correct way to do it? And is there a limit to how much/little I can charge on commission? Essentially If I'm not representing a buyer and they sign a nonagency agreement could I legally charge whatever commission I wanted because I'm not a fiduciary?

I hope that this question comes off the right way, I'm really just trying to figure out how to properly bring off market deals to customers and clients, and what my duties are as an agent to both. 

Let me know if you have any experience either wholesaling as an agent or representing buyers on off market deals, any input you have is greatly appreciated!

[Brad Hammond]

If you are representing a buyer in a wholesale deal, the buyer is responsible for paying you your commission.  The buyer can either pay you in cash (via closing costs) or they can roll the commission into the purchase price like the $105k scenario you mentioned.  

If you are not representing a buyer, you would be flipping the wholesale deal.  Nothing wrong with that but you might need to disclose you are an agent.  Double-check with your principal on that one.