Figuring out the assignment fee

Ok, different deal…


zillow has 63,100

Owner wants 30K

Minor repairs inside, haven’t seen property yet…

For the assignment fee, I want to be fair but make a conservative profit…

Would I go for 7800 (10%) of FMV? Or would I do 10% of what I offer the seller? And I was told I should double whatever Im asking to
make room for negotiations. This would be my first deal, what would you do?


It depends on who your assigning to? A owner occupied buyer or an investor.

FMV / ARV does not matter your fee is based on the property purchase when you assign the contract!

Purchase price, rehab and carrying cost’s can not exceed 70% of value for an investor to purchase, your assignment fee must be part of that purchase price!

$78,000 - FMV / ARV
$23,400 - 30% Investor purchase margin
$54,600 - Actual investor purchase price
$30,000 - Purchase Price
$24,600 - Maximum amount of rehab, carrying cost’s and assignment fee

If you are assigning a property to an owner occupied buyer getting a mortgage loan or a 203k loan the assignment fee has been studied and found that about 6% is the maximum amount of money a home buyer will pay out of pocket for the assignment! Anything more than this and owner occupied buyer will go find a different property as your assignment fee can not be included in the HUD 1 and borrower can not include your assignment cost in the loan or closing doc’s!

If you are assigning this to a real estate investor about 10% is the highest you will find successful, anything more on an assignment and the investor will walk as there are other deals out there and since you don’t actually own it, or are at risk in it investors feel 10% is a fair profit.

If you actually bought and own the property and were selling it to an investor you may be able to get 15 to 20% of purchase price as is!

Most of the wholesalers I know don’t negotiate there price, price is what it is and either you buy it or it get’s sold to someone else!

If you buy for any price and get transactional funding, buyer (C) has absolutely no idea what you paid and a deal is a deal whether you make 10% or 50% profit!
But you will have to close to you using transactional funding and then close to your end buyer (2 Contracts)!


Ok, so if there were no repairs needed… Then I would be safe asking 15600 as a fee to make room for negotiations?


Still putting me well under 54600.

Am I looking at that right?


As long as you double close using transactional funding you could do that, however this is way to much for an assignment fee!

A - B then B - C using two purchase contracts!


Ok, I don’t wanna do that. Im trying to start out as simple as possible. Im not using transactional funding and I don’t know how to do a double closing.

So 3K for an assignment fee (10% of the 30K asking price)

The deal still keeps its allure… Sounds good?

If you are uncomfortable with double closing maybe ask a title company for help? Wouldn’t they want you to succeed? Since they will make money off it.

Worth a shot. Good luck.

True, but theres still the issue of transactional funding. Being brand new I feel very uncomfortable getting funding and I don’t have a buyer yet.

And even still, I’d have to find the funding source. So if you guys were brand new like me, how would you do this deal?

im glad to read about this thread.


So she could get her dfibulator battery link in there…oh, wait - no link until 10 posts…DARN!