As a local agent who specializes in multi family purchases, I have echoed many of the same principles to my clients.

What is the best ethical way to get started wholesaling?

One of the core principles is that you can't be involved, do anything yourself or pay with your personal money.

There may be ethical reasons to not assign a contract (my personal opinion is that (1) if the contract provides seller financing or other terms that rely on the performance of the buyer after the closing, it is unethical to switch buyers without the seller's permission or (2) if you haven't properly vetted the assignee or used language to prevent them from also assigning to someone who can't perform and you are not able to close if they fail to, that is not fair to the seller) but that is a personal opinion not a legal distinction.I'd be interested in taking assignment of your contract if it is a truly profitable deal. 

If we bid our own principle do we have to pay that out of pocket?

Just do your part by the letter of the contract, be ethical and honest, and you should be okay 99.9% of the time.

I am a quick learner and have many references that can vouch for my hard work ethic.

These are professionals with additional training and a stricter code of ethics.

These are professionals with additional training and a stricter code of ethics.

It was a targeted purchase using the principles laid out in HOLD: How to Find, Buy, and Rent Houses for Wealth.