Wholesale overview

I have yet to make my first deal but have been interested in real estate for some time. Based on my lack of extra funds I think wholesales may be my way in. Can someone give me just a brief outline of how a wholesale deal will happen? I am in Akron Oh which is not a huge market maybe a bit smaller than Cleveland Oh. Any recommendations of other things I can try outside of wholesale. Thanks


The basis of wholesaling is finding properties ideally at 70% LTV for a pristine condition property or less for a property needing maintenance, updating, remodeling or rehabbing. The cost of all repairs and overhead is deducted from a pristine value of 70%. 

The process is:

  1. Contract as agreed and signed by both parties. (Must be created as John Hancock “And / Or Assigns” )
  2. Either assign contract (Usually for a 7% maximum profit as the assignment is not included on the HUD 1)
  3. Or Do a double closing using transactional funding source (You close to you in the afternoon and close to your end buyer the following morning. Cost is usually 1% for 24 hour use of funds.)

When you do an assignment always get more money down from your buyer than you placed in escrow as earnest money.
You theoretically can get some percentage, half or all your assignment fee upfront. Make sure what you receive is written up as non refundable.

As a double closing you can get more for the price of the property but must go through two escrow closing transactions.

Good luck,


If I were starting today with no money and only ambition, I would do the same that I did in 1991 when I was broke and just starting with these types of transactions which are still viable in today’s market:

  1. ‘sandwich lease purchases’ contract to buy on a lease purchase, then contract to sell using same, only you can label the re-sale as ‘owner financing, no credit required.’ A lease purchase is a method of financing. Many homes can be acquired via lease purchase and you can get 100% financing through an L/P Contract. Then find a credit impaired buyer with down payment money and ability to pay monthly. The longer the contract, the more you will earn. Ron Legrand has a great program and offers 10 year Lease Purchases to acquire ‘negative equity’ properties and allow time for new buyer to build equity through pay down and market recovery. While on the topic, you can find Ron’s programs on ‘subject to’ transactions which are also viable in today’s market.

  2. Buy low under a contract with delayed closing, find buyer at full retail, then pre-sell the owner financed note you give to new buyer, into some third party’s IRA or Pension. There are some $7 Trillion in qualified money that could be used as a source to line up note/mortgage buyers. Walk away from closings, when the dust settles, with your profit. I’ve done hundreds of these transactions over the years and still do in the current markets.

Hope this helps.


I’m new to Wholesaling, and i would like to know how to create a contract agreement from sellers and what are the details need to be included and what are the procedures?
Bandit signs are must?
And also where to find the cash buyers??

Thanks in advance!

Hi man,

We help a lot of our outsourcing clients find both buyer and seller leads on the likes of craigslist.
If you know a bit about real estate investing, you can quickly figure out what sellers are likely investors. This could as example be people selling rehabbed houses or landlords selling property. Contact those guys and ask if they are investors and boom :wink:

I did a video to explain further, but I dont think I’m allowed to post it here, but shoot me a private message if you are interested in getting it.

Kind Regards

Hey GR, what does this statement mean? What is it about the HUD1 that you apply a 7% max to your fee? Thanks

I am looking at wholesale property the property needs every thing it needs to be taken down to the studs it is on the market for 130 I am going to offer 45K no more then 65k comps are 200k how do I sale the paper to my cash buyer?

Hey Norman, you will need a simple one page agreement called “Assignment of Contract”
If you IM me I will send you a blank copy.


You can not borrow the money used to buy an assignment so seven (7) percent is the proven mathematical maximum before a buyer will walk away and find another property to buy as this money has to come completely out of pocket! Typically I use assignments to move properties where I am not asking more than 7% and transactional funding to sell making any spread over 8%.