Wholesaling while working with an agent

[Account Closed]

Hey all,

I'm currently working with a real estate agent to bid on MLS properties in order to fix and flip.


I'm very new to REI, but I would not be opposed to wholesaling.Right now, I'm only focusing on one fix and flip deal at a time.


I do have substantial cash reserves, but I'm looking to successfully complete my first flip before I make concurrent capital outlays on several fix and flip properties.


Wholesaling, it seems, doesn't require such large capital expenditures.

My concern, however, is my agent's commission. If I successfully find a seller and get a property under contract, could my agent's commission potentially wipe out my profit from the assignment?

As of right now I haven't mentioned the possibility of wholesaling to my agent. Truth be told, my mentor (not a fan of wholesaling) keeps telling me to avoid it because "I'm leaving money on the table". I see wholesaling as a hedge (kind of like how mutual funds invest in a variety of asset classes)- a way to mitigate some of the risk associated with the holding/rehab costs of fix and flip properties.

What are your thoughts about the agent's commission? When I assign the contract, would the new buyer be responsible for the commission?

Thanks!

-Patrick

[Bryan L.]

@Account Closed - There's two easy ways to fix your problem.

1. Become a Realtor yourself.

2. Instead of doing a wholesale "assignment", just go ahead and buy the darn thing (you have the cash, right?).

3. Do both of the above.