Doing an assignment

Doing an assignment

HI this bexsentico and i just want to let folks know i didnt write this its some info i found out and thought it might be helpful as it was to me

I have been working with more and more real estate investor wholesalers. One of the first questions I am asked by people who are new to the business is exactly how wholesalers actually make money.

First, I want to describe what a wholesaler does and does not do and then I will cover how they actually make a profit when they wholesale a deal.

When we are talking about wholesaling real estate, we are specifically referring to you finding a great deal, placing a contract on the property and then selling your rights in the contract to another investor or someone who will be living in the property.

Specifically, you are not "helping people sell their home," like you would be with a real estate license.

So, how do wholesalers make money? They make money by selling their rights to the contract. Here's an example of how a wholesale deal might work.

You find a property that is worth $100,000. You talk with the seller, and they agree to sell you the property for $55,000. You then write up a contract to purchase the house in the next 45 days for $55,000. You also include that you have the right to assign your contract to someone else if you want to.

Next, you go and find another investor who wants to purchase the house or someone who wants to live in the house. For this discussion, we will call them your buyer.

You and your buyer agree that they are willing to pay $65,000 for the house. So, you buy it for $55,000 and you are selling it for $65,000. You have a gross profit of $10,000 (not including your expenses to find the seller, find the buyer and any closing costs you might have).

In future articles, I will cover the mechanics of how the transaction works, but for now realize that your buyer will be purchasing the property for $65,000 and the seller will receive their price of $55,000. This leaves you with a gross profit of $10,000 on the deal.

If your buyer comes from a real estate agent or broker on your dream team, you may also need to pay a real estate commission from your profits. On this particular deal, if you agreed to pay a 3% real estate commission for your real estate agent or broker to bring you a buyer, you would pay them 3% of the $65,000 purchase price or $1,950. In that case, instead of grossing $10,000 on the deal, your profit (before other expenses) would be about $8,050.

The big picture is simple: wholesalers are paid for finding truly great deals, placing them under contract and then selling their rights to purchase the property at the contracted price.

The more you learn about real estate, investing, sales, marketing and psychology - and actually implement - the more successful you will be at wholesaling real estate. However, what are the key things you must learn to wholesale real estate profitably?

First, you need to be able to find great deals. This entire process starts with the knowledge of what a good deal actually is.

A deal needs to include one or more of the following criteria:

1. Able to be purchased for significantly below current fair market value, and/or
2. Has great positive cash flow with little or nothing down and/or
3. Has the possibility of owner financing

These usually stem from some type of motivation from the seller. As an aside, the motivation of the seller can be from good news like a job transfer with significantly higher pay to not so good news like a divorce situation. In both good and bad scenarios, you should only make deals where both parties win.

The second thing you must learn, which is just as important, is how to find buyers for your deals. I strongly believe you should be doing this from the very beginning by building your buyers list. A buyers list is nothing more than a list of people who are usually investors, but can also include folks looking for a home to live in. The size and quality of your buyers list can determine your success or failure as a wholesaler because you need people to sell your deals to.

The first two things - finding deals and building a buyers list - are the TWO major areas that you must learn and master as a wholesaler. Practicing, improving and ultimately, mastering these two skills are the foundation that you must work on daily.

In addition to finding deals and building a buyers list, you must also learn how to complete your paperwork to wholesale real estate. This involves learning and understanding your contract to buy (or option agreement if you use that) and your assignment or contract to sell.

Your ability to put deals together and sell houses relies heavily on your ability to negotiate and sell both yourself and the deal. Become a better negotiator and salesperson and you will improve the number of houses you buy, the price you purchase them at, the number of houses you wholesale to a buyer and the price you sell them for. It is that important.

I am tempted to say that you can't wholesale alone, but I will say, at the least, it is almost impossible to do the entire process by yourself. You should have a team of people helping you wholesale, including key dream team members like a real estate agent or broker who can help you find deals, determine value, bring buyers and introduce you to other critical team members. While you are usually not borrowing money yourself to wholesale deals, having a great lender on your team to work with your buyers can make your ability to wholesale a much smoother process. Also, don't forget the importance that a flexible title or closing company can play in your ability to close creatively structured deals.

Finally, you must understand the transaction flow and especially the closing process. Understanding what needs to happen and when in a real estate deal will allow you to fix things before they become an issue and improve the ratio of your deals that actually make it to closing - when you ultimately get paid. A great dream team can help you accomplish this.

I hope this was helpful this was 2 of the 4 messages im getting from a wholesale website ill put up the other ones in about two days feel free to leave a comment bye and everybody have a good one



Not bad, however, you had mensioned earlier in your post that: "you could add the ASSIGNMENT OF CONTRACT clause if you want to".

Well, if your going to WHOLESALE real estate, then ALL of your contracts NEED to be ASSIGNABLE, or else, your stuck with the property, unless you have added other "CONTINGENCIES" to "exit" the deal without recourse.

So, if your going to be a WHOLESALER, then you MUST have the ability to ASSIGN the contract, AND dont froget to add the correct contingencies to protect yourself, from losing your "shirt". SULLY



assignment of contract

hello,i have read and gone through the courses of doing an assignment and im still a little confused, how and when does a realitor come in to play?


Just do it,don't be afraid to fail,failure is just a stepping Stone to success

Thank you SULLY



good one little properties i dont know the answer to that questions im new to this and still finding out how to do this like i said guys i dindn't write this it was on a site that emails info. Is there anyone with the answer to the above question i think us new guys would really appreciate it thanks in advance

little properties......

the REALTOR comes into play.....when you want him/her to. See you do NOT need the assisstance if a realtor @ ALL, the ONLY time that i "may" and i mean "may" use a realtor is to look for properties on the MLS, since us investors dont have access to the MLS, BUT most of the time, i do EVERYTHING myself(thats how i like it) @ least for now, as i become more activley involved in REI, then the services of a real estate agent may be more of a neccessity. The sole purpose for "my" real estate agent is to: 1) put offers in on my behalf and give me access to the MLS, here and there, my agent is NOT there to hold my hand and show me property after property, like i said, he's basically there on an AS NEEDED basis, BUT that's me, everyone's different, SULLY



Good Post

This is both a good post with good answers. Long time no read Sully


TWITTER - anitarny / FACEBOOK - anitarny


assignment of contract

your saying i don't need a realitor after i talk to the seller about buying the property.
so i don't need a realitor when i find a buyer, the end user?


Just do it,don't be afraid to fail,failure is just a stepping Stone to success

Hi bexsentico

Referring to your original post (thanks for sharing that, btw Smiling ), in the assignment of a contract, I believe you get paid strictly an "assignment fee" that is agreed upon. In order to say you've changed the purchase price from $55K to $65K between sellers/buyers, you would be doing a double-closing rather than a true "assignmment of contract".
I don't know if I worded that clearly. But, basically either you re-sell the house for the $65K as a wholesale, or you assign the $55K contract for a $10K fee. See this thread to learn more.


P.S. Thanks again for sharing this with us, bexsentico.

P.S.S Like Sully said, you DON'T have to use a realtor. It's nice to have a good one on your team, though.


"Obstacles can slow you down, but they can only stop you with your permission." Dean Graziosi (BARM pg 101)

"For I know the plans I have for you," declares the Lord, "plans to prosper you and not to harm you, plans to give you hope and a future." Jeremiah 29:11

For a little about me, welcome to the site, and a few tips for new DG family members, click on this link:


What a great post with good information you shared here. I agree with everything, and must say that Sully and Rina are absolutely correct. Little properties, again Sully hit the nail on the head. You do NOT need a Realtor to do this. Although, there are Realtors out there that DO help clients with assignments. They are either wholesalers or investors themselves like Al. But remember, if you do use a Realtor you also have to share the profit with them. I, like Sully, prefer to meet the seller myself, build raport and close the deal. Same with the end buyer, it makes it more of a people business when you have direct contact with them rather than doing it all through your Realtor. Even when I use a Realtor, I request to be at every meeting between all parties throughout the transaction. That's just me though. Eye-wink


Cool Elena Cool
Psalms 118:23 "This is the LORD's doing; it is marvelous in our eyes."


If the property is listed by a Realtor, it costs the buyer nothing to use a Realtor of their own. If you use the seller's Realtor, you will get only limited representation. The listing agent has first responsibilty to the seller. The Realtors commissions are paid by the seller(there is no cost to you). I do think it is a good idea to attend meetings involving all the parties, if you can get all parties to agree.

If property is not listed by an agent, you can do it yourself. Title Companies are very helpful in seeing that you have everything you need to complete the sale.




Watch your thoughts; They become words,
Watch your words; They become actions,
Watch your actions; They become habits,
Watch your habits; They become character,
Watch your character, it becomes your destiny.

Frank Outlaw


You know I have nothing but love and respect for you. I would definitely work with you on a deal and ONLY you. You're the exception! Eye-wink
By the way, how's your son doing? Are you guys taking Phoenix by storm???


Cool Elena Cool
Psalms 118:23 "This is the LORD's doing; it is marvelous in our eyes."

3of 4

If you plan to wholesale real estate, I hope you know by now that you absolutely MUST be building your buyers list. In fact, I am so adamant about this, that clients and investors who I work with often ask me which comes first: the buyers list or an actual deal.

I strongly recommend that you start building your buyers list immediately - even before you have your first deal. What?! How do you build a list of buyers even before you have a deal to market?

Well, without going into all of the details of how to build a buyers list, here are a few ideas:

First, you can market generically that you are looking for investors that are interested in deals. Put out some ads on some free classified sites seeking investors who want to be notified when you find a great deal. Ask them if you can add them to your buyers list. Most serious investors will want you to call them if you have a great deal.

Second, you can contact investors that have investment property and ask them if they are looking for more deals. If they say yes, then ask them if you can add them to your buyers list. How do you find these guys? Three very quick ways: people advertising that they want to buy houses, people with houses for rent (they're investors aren't they) and absentee owner mailing lists.

Third, you can borrow deals from other investors and offer to help them market their deals. While you are contacting investors using the first two methods, you can also ask them if they have any deals. The odds are that they will have a deal or two. Ask them if you can do some marketing for them to help them sell it. If they agree, you now have a deal that you can use to meet people interested in deals, which both helps you build up your own buyers list and helps your new investor friend get their deal sold.

Fourth, give away real estate courses and a list of distressed properties. I use this method with my wholesaling clients. I allow them to give away one real estate course on CD that I have, to attract people who are interested in investing, in order to build their list of potential investor buyers.

So, while some people believe that you need to have found a deal to start building a buyers list, I strongly disagree. You should be building your buyers list from your first day as a real estate wholesaler and keep building and replenishing it every single day that you are in business as a wholesaler. It is one-half of the life-blood of your business (the other half is finding deals) and it is critically important to do it everyday.

Thanks everybody for the comments above

Until my next post,

Thanks Brian!

More great info, I really appreciate you sharing this with everyone. You're already a great asset to the family! Keep up the good work. Eye-wink
By the way, where do you get your list of distressed properties? That and the CD are great ideas, I'm going to try those... Thanks again!


Cool Elena Cool
Psalms 118:23 "This is the LORD's doing; it is marvelous in our eyes."

Elena M

In several articles I talk about many low and no cost methods to build a buyers list of investors that you can wholesale your real estate investor deals to. Sometimes, it is worth it to spend a little money to build a much higher quality list of investors. That is the topic for this article.

Sure, building a buyers list of 300 people in a month is great, but how many of them are truly serious buyers? If you are primarily using e-mail as your media for communicating with them and you have a great e-mail service to get those e-mails out quickly--regardless of the number on your list--then having a big list is not much work and is a great base. But, what if instead of having 300 people that are interested in deals, you had a list of 30 people that have bought a deal as an investor in the last 3 months? Wouldn't that be a small, but higher quality list?

Well, that's the beauty of what I call the "Absentee Owner Goldmine".

There is a way to easily get a list of all the people in your market that have purchased a property in the last 3 months (or any time period you define) where they are having the tax bill for the property sent to an address other than the property address. This list is called the absentee owner list.

What does that mean exactly? Well, most people that are living in the house as an owner occupant have their tax bill for the property sent to the address of the house. The people that tend not to have the tax bill sent to the property are the people that are not living in the property themselves. Folks not living in the property are usually investors. So, what you are getting is a mailing list of investors when you get a list of absentee owners.

Why is this list so valuable to you and me when we are building our wholesale buyers list? Investors tend to buy more than one investment property and have a high probability of being interested in deals you find as a wholesaler. So, this list is a list of people that likely invested before recently and are likely to invest again.

So, how do we dig in and extract the gold from this mine? I prefer to do it by mailing a post card to them with a particular deal that tells them to contact me if they are interested in.

Then, once they contact me, I get their permission to put them on my investor buyers list. I make sure I have their e-mail for e-mail blasts, phone for calling or voice broadcasts, fax for fax blasts and updated address in case the address I have was not the best one.

Once I have their permission and their e-mail, phone number and fax number I can send out deal notifications to them at a much more cost effective rate than having to do a postal mailing to a larger list. The people that have responded become your highly qualified investor list that you can share your deals with.

I hope this helps everyone

Until my next post,

Thanks Brian!

Great post, thank you so much for sharing that. But you didn't mention where you get the list from.


Cool Elena Cool
Psalms 118:23 "This is the LORD's doing; it is marvelous in our eyes."

Elena M

I am a huge fan of using poor methods (where you have more time than money) to build your buyers list at first, but at some point you will realize that spending a little money on marketing to build a list of serious buyers is well worth the expense. That's when you should seriously consider using direct mail postcards to quickly and cost effectively build your buyers list.

First, I want to tell you that I and many other marketing savvy investors have built huge buyers lists with this method. It is not theory. It is a proven method to generate a list of buyers. Here's how to do it.

You need to get a mailing list of investors. The list you want is the Absentee Owner list, which is comprised of owners that have their tax bill sent to an address other than the address of the property that they own. This usually means that they are not living in the property and are probably investors.

So, where do you get this list? Right now, I get mine from public record data via my Multiple Listing Service (MLS) subscription, since I am a licensed real estate broker associate here in Colorado. However, before I had my license, I did not have access to the MLS and I got it from alternative sources. I have also used a subscription service like RealQuest. If you don't want to commit to paying the monthly fee for RealQuest you can also use a mailing list broker. Contact me for a current recommendation on what list broker I recommend when you are ready to purchase the list.

Once you have your list, you need a service that will allow you to upload your list and the message that you want printed on your postcard. This service should then print, address, and mail your postcards for you. Trust me when I say that you DO NOT want to do this yourself. It is cheap to have companies do this for you - but very time and labor intensive to do it manually. I have personally used the US Postal Service Click 2 Mail service and have been extremely happy with them. You should strongly consider using them.

I recommend you use a small 4 by 6 post card. You might see a bump in response from using a yellow card stock, which tends to cost a little more, but you will still get a good response from just using white with black text. You don't need to use fancy colors, photos, glossy paper or image advertising. I use a "typewriter" font message to my list of investors.

What does my message say? I've tried various messages over the years and many different mailings. If you have a particularly great deal (or have one you can borrow with permission), you can send out a message telling your list some very basic info about the deal and ask them to call you.

On the call, you can tell them about the deal, but be sure to tell them that you come across great deals for investors all the time, and ask them what they are looking for. Listen very, very carefully as they tell you what they want in a deal. These are the types of deals you must find to become a successful wholesaler. Once they tell you what they are looking for in a deal, then ask them if you can notify them of great deals as you, and other investors you work with, find them. With their permission, you can then add them to your buyers list.

Of course, if you are part of our wholesaler training program, you can add them, using your special referral link, to join our list. You can track this from inside your Wholesaler Control Panel and earn points that unlock special training materials, course downloads and more.

Elena m i hope this helps and if there is anything else i can help you with just let me know

Until my next post,


One of the most important things you can do, as a real estate investor who plans to wholesale property, is to build a buyers list starting right now.

Don't wait until you have a property under contract to start building a list of potential investors and retail buyers that will be interested in deals that you find. Building a buyers list takes time and/or costs money. Why not save some money and start building your list using low or no cost methods (what I refer to as methods for poor folks) and then spend money to build your list only when you have an actual deal that you need to sell?

Here's how to start building a buyers list using low and no cost methods:

Post Ads on Free Classified Ad Websites

Posting a number of different ads on free classified ad websites can start the process of growing your buyers list. Plus, this method is relatively easy to do (once you learn how), costs no money on most websites, and you will see almost immediate results in most cases.

What types of ads can you run? You can run generic ads looking for investors who are trying to find deals, ads seeking partners to team up with you on deals, ads for specific deals you have, and ads giving away a free real estate course or a list of distressed properties. These are just a few examples; with a little creativity, you could come up with many more.

I go into greater detail on the mechanics of how to post ads on CraigsList, the largest classified ad website, in another article.

Reply To Ads on Classified Ad Websites and in Newspapers

The nice thing about classified ad websites is that on the popular ones, you're not alone. There are other investors posting ads to sell their deals or rent out their properties. Why not give them a call or drop them an e-mail to introduce yourself to them. Find out if they are looking for more deals and ask them if you can add them to your list of potential buyers to notify when you have a great deal. You can also do similar things with people who have posted ads in newspapers.

Network at Your Local Real Estate Group or on On-line Forums

Find out where investors hang out. Visit your local real estate investor club or association and meet other investors. Go to on-line discussion groups where investors are chatting and make new contacts there. Find investors that are blogging about their investing and make friends with them. If you have more time than money, these methods will help you both learn about investing strategies from other investors and build your buyers list.

Direct Mail Investors

A way that I use to quickly reach thousands of investors in my local market is direct mail. I get a list of investors that have recently purchased a house (often called the Absentee Owner List because the owner of the property is not living there) and mail them a postcard about a particular deal I have or about getting together to discuss investing. While this method has cost me about 32 cents per person mailed (including postage and printing), it has been a great way to instantly expand my investor network with people that have actually bought a house as an investment (and not those merely interested in buying a house).

The above methods are just a few ways that you can start building your buyers list. I recommend you start implementing one - or better yet, all - of these methods immediately to start building your list in anticipation of having a great deal to send out.

Until my next post,


Thank you for all the great information, you have been very helpful not only to me, but to others on here I'm sure. I look forward to more of them.
Thanks again for sharing your knowledge so freely! Laughing out loud


Cool Elena Cool
Psalms 118:23 "This is the LORD's doing; it is marvelous in our eyes."

Definitley agree with

Definitley agree with E(elena) on the quality versus quanity when building your buyers list, good point E!, SULLY



Wealth of Info

I am looking to get into wholeselling and I think that this forum is so great for beginners.

Syndicate content