What homeowners don't understand about wholesalers

[Elise Bickel Tauber]

I have an opinion on wholesalers. One that may be unpopular (or maybe very popular). Wholesalers, are fantastic, motivated, and hard working individuals and have skills that a lot of real estate agents don't have. They are very determined to get "listings" and make the deal work. The problem (for home sellers) is that they have no fiduciary duty to the seller. Which means, a homeowner, who relies on information from their agent who listing their home, is often expecting that same loyalty from the wholesaler. It leaves a lot of homeowners feeling duped when the property finally closed. I've seen it happen many times. The seller sells a home to a wholesaler for $25,000 and then finds out the buyer who actually bought the house is buying that home for $45,000-$50,000 or more. If they had listed with an agent, they could have ended up with tens of thousands more. 

For investors who are selling homes to wholesalers, how do you feel about selling for a flat fee and the wholesaler making a large amount of profit on your home? Were you aware that many wholesalers have something called a "spread" which is often large to make a profit?

For the wholesalers out there, are you disclosing that you are only out for your best interest? Do you disclose your spread? Have you ever thought of getting your real estate license for whatever state you are located in, connecting with a real estate agent where you wholesale and getting a referral fee for all those listings? It would be a lot less then most wholesalers get in their spread but would also (often) require a whole lot less work since the agent would be the one showing, marketing, etc.

I would love to hear people's thoughts on this! Good, bad or indifferent!