What Is Wholesaler (Team Member)?
A wholesaler finds motivated sellers (distressed, inherited, off-market), negotiates a purchase price, and puts the property under contract. They then assign the contract to an investor for a fee instead of closing themselves. The investor gets an off-market deal; the wholesaler gets a fee. You find wholesalers through real-estate-investor-association meetings and referral-networks. Run your own deals—wholesale deals can be good or bad. The fee is built into your purchase price.
A wholesaler is an investor who finds off-market properties, puts them under contract, and assigns the contract to a buyer—typically for a fee—without taking ownership.
At a Glance
- What it is: Someone who finds off-market deals and assigns contracts to buyers
- Why it matters: Access to deals that never hit the MLS
- Fee: Typically $5,000–15,000 per deal (built into your price)
- Find: Real-estate-investor-association, referral-network
- Rule: Run your own arv and deal-analysis
How It Works
Process. Wholesaler finds a motivated seller (distress, foreclosure, inheritance). Negotiates a price (e.g., $120K for a house worth $180K arv). Puts it under contract with an assignment clause. Assigns to you for $130K (you pay $130K, wholesaler keeps $10K, seller gets $120K). You close and own the property.
Assignment fee. The difference between the contract price and your price. $5K–15K is typical for single-family. You're paying for the deal—not the property. The numbers must still work after the fee.
Quality. Wholesalers vary. Some find great deals; others push overpriced properties. Run your own arv, repair estimates, and cash-flow analysis. Don't buy because it's "off-market."
Real-World Example
Ava in Denver. A wholesaler from her real-estate-investor-association sent her a duplex. Contract: $245,000. Assignment: $255,000. Arv: $312,000. Repairs: $28,000. She ran the numbers: $255K + $28K = $283K all-in. Arv $312K. She had room. She closed. The wholesaler made $10K. She got a deal that never hit the MLS. The next deal the wholesaler sent was overpriced—she passed. Always run your own numbers.
Pros & Cons
- Off-market deals—no MLS competition
- Wholesaler does the seller finding and negotiation
- Build a pipeline—good wholesalers send deals regularly
- Bird-dogs and wholesalers can feed your deal flow
- Fee adds to your cost—numbers must work after it
- Quality varies—some deal flow is bad
- You're not the only buyer—good deals go fast
Watch Out
- Overpaying: The assignment fee is your cost. Arv minus repairs minus fee must leave room for profit. Don't buy because it's "off-market."
- Double assignment: Some wholesalers assign to another wholesaler who assigns to you—double fee. Ask: "Who's the original contract holder?"
- Contract terms: Review the assignment clause. Ensure you can assign and that the seller has approved. Some contracts prohibit assignment.
Ask an Investor
The Takeaway
Wholesalers can be a pipeline for off-market deals. Find them through real-estate-investor-association and referral-network. Run your own numbers—the fee must fit your arv and cash-flow analysis. Don't buy bad deals because they're "off-market."