I just paid an $80,000 wholesale fee...
Another investor in my network recently got a property under contract, and was looking to assign it. I saw it on Monday, and he gave me his "buy it now" price (ie: don't wait to see if any other investors are interested and potentially the price could be higher or lower).
The numbers worked for me so I went firm, not knowing how much his wholesale fee was but knowing it would be a lot. I don't care - it's a good deal.
He had this bungalow in Toronto, Ontario under contract for $520,000, and assigned it to me for $80,000. I both flip and wholesale, but the largest assignment fee I've ever received on a wholesale was $70,000, and now I'm paying an $80,000 fee!
However, what does that matter? I'm paying $600k. It needs a lot of work, which I'm anticipating will cost $120k. The comps at the moment show this would sell between $900k-$1m. I'll likely make well over $100k on this to share with a partner.
If you every have a buyer balking at your wholesale fee, they're either inexperienced, or there isn't enough meat left on the bone for the buyer.
Everyone should make money when we;re doing deals!
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- Tax Strategist| National Tax Educator| Accepting New Clients
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It's funny how this goes to show that each person's perspective of a great profit, great deal, risk level are so varied and really...there's no right or wrong answer.
I know people who are thrilled to make $20k on a flip.
I know people who won't get out of bed for under $100k.
Both those people are doing better then they were before investing *shrug*
