I am very new to wholesaling. I have been told 2 ways to collect your assignment fee. Wait until the close of escrow and be paid out through escrow (as a type of ‘debt’) or have the investor pay you a lump sum of cash to simply assign him/her the deal and then walk away. Obviously the latter sounds more advantageous to us (because if the deal goes sour for reasons beyond our control … we were still paid for our work) … but I am not certain how everyone does that. Thoughts? Thanks!
Sometimes the investor will pay you a percentage or an upfront fee of say $500-$1,000 depending on the type of deal. Or they will pay you a small fee (around $100) if you find them the kind of properties they are looking for.
I wouldn’t give up a contract, unless I had some Cash up front. The entire assignment fee. This is so if something goes wrong and the buyer doesn’t close, you still have the money that is nonrefundable as stated in the contract.
I agree with your advice. You need some money for the contract. Possibly you can split it up half now for the contract half later or you can demand it all up front.
I would also make sure that you keep tabs on the deal to make sure your buyer does close otherwise if they don’t it will look back on you.
If your buyer can’t close on the deal for some reason you already have your fee and you should try and get another buyer in their right away to close.