I cap my assignment fees at $2997 for many reasons but mostly because I love to provide better deals than my competition. But I have been running into a situation quite often this year with other wholesalers selling my deals for me. Most would say not a problem right? But with my increased marketing this year some of these buyers are finding me directly because they find out that they can save a lot of money. Most often the other wholesellers are making double or triple what I am and I don’t care, that is not my issue. But my question is; Is it Ethical to sell to these Investors without cutting in the other wholesellers? I did not seek them out, they found me.
Maybe it’s time to earn more… and it’s very super duper mother faking tarantula spiders and chicken joy Ethical… If you want to sell your deals faster…use wholesalers…and If you already have investors…don’t use them anymore…try to maximize your profits…
If another wholesaler actually calls you and says I have clients looking for "Such and Such" to purchase and you have it in inventory and make a deal which becomes a sale then the wholesaler may be entitled to a referal fee if your willing to pay one.
If people just come to you through what ever means then you owe nobody!
I think you should keep integrity. It’s not always about the dollar and in fact it may help you earn more to not undercut people. If you are aware that a wholesaler that you have given permission to market your properties has a buyer that he contracted a price with but that buyer has come trying to buy the deal direct from you somehow then I personally would tell him he needs to buy at the price the wholesaler contracted with him or try to work another suitable profit scenario with the wholesaler where you pay him his fee yourself if possible.
All about the win/win deal. You shouldn’t have people do work in a deal, bring a buyer then undercut them.
I’ve done a ton of these, these are like my little “bread and butter” deals, except I charge min $3K a pop when I do em. My mentor taught me this one a while back and calls it profit stacking.
I did 6 of these one month and I can’t tell you how fricken cool it is to never even leave your office, you just get a call about a “Hot one” then make a call to your list for investors who want em.
Basically you end up going from buyer to buyer each jumping up the price a little till you get to the end buyer. There’s a lot of trust involved that everyone will pay everyone, but I haven’t been burned yet. It’s one more profit stream to add to your wholesaling business.
The dude who mentors me told me the funniest story about this. He called his list about a property that he was getting rid of that was his own. He was wholesaling it so I think he said it was worth like 70k and he was letting it go for 40k. Well he called his list and later that same day, someone who he didn’t call, called him and offered him a great deal on a house worth 70k and the investor offered it to him for 55k. He asked him what the address was and it was his own house.
how funny is that?
One thing I will add to the mix is if one wholesaler sends a buyer who is another wholesaler over to do business with you on a deal like this. I would recommend giving that other wholesaler a nice chunk of change every single time you do business with the investor who sent him. It’s only fair, you wouldn’t have the deal if the other guy didn’t send him to you.
Do you mind explaning what profit stacking is? I’ve never
heard that term before,
I think that in this business you need to keep your integrity. If a wholesaler brings you a buyer for your deal and you gave him the OK to market it, then you sould hold up your side of the deal. In the long run you will come out on top, believe me.
That’s all we have, is our word!!