Wholesaling on an option?

Bird Dogs, Wholesaling
1

How do you wholesale on an option contract exactly?

I have a seller who does not want to sign purchase agreement, because he has signed one before with another wholesaler. I am thinking of having him sign an option, but I have not done one before and not sure how to structure it. I have heard that with options sellers can still sell the property to other buyers, and the option just locks in the price and terms. I am worried about my end buyer going around me and getting the property. Also, do you need to put an earnest money deposit down on an option?

Any help is appreciated.

Thanks

2

I’m pretty sure the option gives you first right of refusal. In other words, if the seller finds a buyer he has to offer you the house at the price that buyer is offering and you can accept or decline that offer. You’d accept it if you have a buyer who is willing to pay more then that price and you’d decline if you didn’t and the the option would be canceled. That is what I think, but I could be wrong. Anyone have a better explanation?

3

That is basically what I was planning on doing. I was going to write in a 10 day window that I had to purchase if the seller found someone.

I was going to write the option for 3 months.

Also, do I need to put an earnest money deposit down to make the option valid?

And, how do I assign the option? Do I just write and or assigns in the option like I would a normal PSA agreement, and just assign the option to my end buyer?

Thanks