Advice for potential wholesale when seller has agent?

Advice for potential wholesale when seller has agent?

Phoenix, AZ · Member since 2017 · 7 posts · 0 votes

Hey guys, I'm pretty new to wholesaling so I would appreciate any advice you could give on this subject. I recently got a message from the real estate agent for a seller I sent out marketing to, telling me he understands I'm interested in purchasing his seller's property and to call him back for more info if I'd like to make an offer.

I had no idea the seller was working with an agent already to sell the property, and my first instinct was that the deal wouldn't work if they're already listing with an agent, that it would be another middle-man in the deal, and he'd discourage the seller from selling for so low. But I do have an end buyer in mind for the property that tends to buy much closer to market value than typical investors, and think the numbers could work. The property hasn't been listed on the MLS as of yet.

The place where I have apprehension is in how the deal would work - I've never done a deal through an agent and so I was curious what sort of extra hurdles come with this, and what potential solutions I might have for them. The sort of things I'm talking about are earnest money, proof of funds, all the extra forms and paperwork that come with a traditional sale that I would assume the agent would insist on - is there a way around those things when working with an agent, or will I be basically stopped in my tracks once those get brought up? Will the agent scoff at me wanting to use my own purchase contract?

Any info anyone could give on the subject to help me get a better idea of what to expect would be incredibly helpful. Thank you in advance.

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  • Curt DavisBusiness Member
    Flipper/Rehabber · Memphis, TN · Member since 2008 · 5k+ posts · 2k+ votes
    8y

    You are going to have a hard time if the seller has an agent involved now and all those you are worried about will happen. Wholesaling is mainly for off market listings where you can control the deal flow. This Realtor will control the deal. Best bet is to move on to the next one. 

    Good luck

    Curt Davis - KAIZEN Realty538 Reviews
  • Real Estate Agent · Tacoma, WA · Member since 2017 · 23 posts · 9 votes
    8y

    It's not listed on the MLS.. so is it on the market? Agents can be involved with off market deals, maybe there's room for both of you to make money. I'd say its at least worth a couple phone calls to see where everyone stands.

  • Phoenix, AZ · Member since 2017 · 7 posts · 0 votes
    8y
    Originally posted by @Andrew Babcock:

    It's not listed on the MLS.. so is it on the market? Agents can be involved with off market deals, maybe there's room for both of you to make money. I'd say its at least worth a couple phone calls to see where everyone stands.

    My assumption is that they intend to list it on the MLS soon, and my hope was to be able to catch it before that happens and see if the seller is interested in a cash offer for a quick closing and all that.

    I'm just worried about the added complications of the real estate agent being involved. With the end buyer I have in mind, I absolutely do believe there is room for both the agent and I to make money. Where I'm hung up is the actual details of the transaction like I mentioned above - earnest money, proof of funds, and the other forms the agent's brokerage might require for the sale.

    Would it be wise to just tell the agent that I'm looking to purchase the property with another end-buyer in mind?

  • Real Estate Agent · Tacoma, WA · Member since 2017 · 23 posts · 9 votes
    8y

    @Matt D.  I'd definitely express your goals to the broker involved, I'm sure the broker is also interested in a quick cash closing, I'm also sure he knows that you're a wholesaler.  At the end of the day, however, its up to the seller how they want to sell their property.  Can you get ahold of the seller to show the benefits of working with you vs. the broker?  Has a listing agreement been signed yet?  Like Curt said you're probably going to be subject to everything but from my point of view I think it'd be worth your time to make some phone calls and see where everyone stands on the deal, let us know how it pans out, good luck!  

  • Flipper/Rehabber · Montgomery, NY · Member since 2016 · 2k+ posts · 1k+ votes
    8y

    My guess is if you let him know you are not the end buyer but wholesaling the deal, that will be the last you hear from him and the house will be marketed. Your end buyer will see it on the MLS and make an offer on the house from there. I would think moving on is best.

  • Contractor · Indianapolis, IN · Member since 2016 · 267 posts · 144 votes
    8y

    Depends on the agent but in my experience it is more of a headache than it is worth. Find out if the agents contract on the property expires or they can fire him. They often end up rewriting the contracts so as to obligate you in a manner that puts you in a bad position as a wholesaler. Lot's of problems. I wouldn't get held up on this one. But that's your choice and maybe someone else knows better.

  • Investor · Boston, MA · Member since 2015 · 398 posts · 147 votes
    8y

    You could always try to contact the owner directly by looking up who owns the property and some internet research .  If they haven't signed an agreement with the realtor  yet then  there shouldn't be an issue but of course the realtor is going to try to get in the middle so that he can make a cut .

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