Help clarify Wholesaling

[Matt Kemery]

Hello BP, 

One of the things I struggle with is why people would want to wholesale their homes. I know that this answer would vary per market, but in a market such as Philadelphia, Pa. or New Jersey (certain areas within) homes are very hot and can be sold on the market quickly for more money than signing with a wholesaler.  

Why would a person whether they're in need for money or "a motivated seller" decide to sell (wholesale) a property in a hot market or not in a hot market when they can put it on the market as a handyman special for more money? 

This can be kind of a confusing thing to me, hopefully someone can help. 

Thank you!

[Matthew McAlarney]

There are a few reasons why . One is wholesale deals are done typically with cash or hard money. Which makes it a lot easier for a quick closing. Waiting for someone to get approved for a bank loan can take months. There is carrying costs for the home as well. Thats a few more months your paying a mortgage and taxes.  If there is an emergency and they cant wait three-four months they might go that route. Also, if you list with an agent you will be typically paying 6 % commission (In northern NJ). That s an expense they wont incur with a wholesaler. They might be trying to avoid foreclosure and messing up their credit. Most of the time if people need to sell fast ,they will rather go with a wholesaler that might get them cash in as little as 2 weeks.