What is wholesaling?
In a typical wholesale transaction, an investor gets a property under contract and then exits the deal by assigning contractual rights to another buyer or by completing a double close. The wholesaler's value is usually in finding, negotiating, and structuring an opportunity that another investor wants to purchase.
The basic A → B → C picture
Seller
The owner agrees to sell under an AB purchase contract.
Wholesaler / Investor
B controls the contract or purchases the property, depending on the exit structure.
End Buyer
Usually another investor who intends to renovate, rent, resell, or otherwise execute the property strategy.
Two common exits
Assignment
The wholesaler transfers eligible contractual rights to the end buyer for an assignment fee. The end buyer generally closes directly with the seller.
Double Close
The wholesaler completes the AB purchase and then sells the property to the end buyer in a separate BC closing. The wholesaler actually takes title between the two closings.
Where EMD fits
Earnest money is the deposit required by the purchase contract. The amount, due date, refundability, and release rules matter. Missing an EMD deadline can put the contract at risk.
What a wholesale spread is — and is not
Gross spread is not automatically profit. Title charges, transaction costs, funding fees, commissions where applicable, taxes, and other deal-specific costs can reduce what remains.
Five habits that make a wholesale deal cleaner
- Know your contract deadlines.
- Open title early and make sure the closing team understands the planned structure.
- Be clear about your exit strategy.
- Verify the end buyer's ability to close.
- Calculate your net numbers, not just the headline spread.
Think you understand the basics?
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Take the Wholesaling QuizEducational information only. Deal structures, contracts, disclosures, licensing, and legal requirements vary by jurisdiction and transaction.