Wholesale Fees Have Gotten Ridiculous: Here Is How to Beat Them

TLDR
Wholesalers call trusted buyers first because a contract can fall apart. Ross gives three ways to get a better price: watch late deals, become a new wholesaler’s first call, or go to the seller yourself.

Table of Contents

Why the Buyer Circles Matter

Ross ran a wholesale company that completed more than 100 deals in a year. He says the contract is fragile because the wholesaler may spend thousands to get one deal and can still lose it before closing.

That makes certainty valuable. The usual order looks like this:

  1. The wholesaler may keep the best property.
  2. Trusted repeat buyers get the next call.
  3. A large buyer list receives an email blast.
  4. Craigslist, Facebook Marketplace, or another public channel gets the widest reach.

Inner-circle buyers may accept the information quickly and have a record of closing. In return, the wholesaler may take less money for a safer transaction.

No one should pretend to be a contractor, partner, buyer, or agent when that is not true. The source recounts that kind of question as part of the old process, but each person’s role and access should be honest and follow the contract and local rules.

The Broad List Usually Costs More

By the time a deal reaches the broad list, trusted buyers may have passed. Another possibility is that the wholesaler is very good at creating demand and is using the list to get the highest price.

The same force applies to public listings. More reach means more possible buyers. More demand can push the assignment price closer to the open market.

That does not prove every broad-list deal is bad. It means the buyer must judge the actual price, condition, scope, and exit instead of treating “off market” as proof of a discount.

Tactic 1: Watch the End of the Contract

A wholesaler near the end of a deal may want a sure close more than a large fee.

Ross uses made-up deal math. The wholesaler signs at $150,000 and asks $180,000. It is day 85 of a 90-day term. A buyer offers $155,000. A small fee may beat a lost deal.

Ross says his firm had deals with no fee so the seller could still close. Strong firms often have more time and ready buyers. This move will not build a steady lead flow.

Tactic 2: Build Relationships With New Wholesalers

A new wholesaler may find a lead before building a buyer list. Be the buyer they call first.

Places he names include:

  • local real estate investor meetups;
  • local Facebook groups;
  • Facebook Marketplace or Craigslist posts; and
  • direct mail from a new local buyer.

New wholesalers may take a small fee while they learn. They may also set a bad price or send weak deals. You still have to run the math.

Be honest. Reply fast. Close when you say you will. Help them read the deal and be their first call when it works.

Tactic 3: Go Direct to the Seller

The final tactic gives the investor the most control: become the wholesaler for your own purchases.

Ross names Property Radar as the system he used, along with alternatives such as PropStream, ListSource, and Batch tools. The software is not the strategy. It gives the owner and contact data needed for outreach.

From there, the investor can call, hire callers, or send mail. Repeat the outreach; the source gives no fixed month when a seller must respond.

The Home Base and the List

Ross’s simple example starts with all properties in the target county. The data can show:

  • the property address;
  • the owner’s mailing address;
  • a skip-traced phone number; and
  • a skip-traced email address.

He does not narrow this example to owners with three houses or to tax-delinquent records. Those are different list choices, not part of this recording’s instruction.

Before outreach, Ross recommends a simple home base: a landing page, a local phone number, and a real local business mailing address that you are permitted to publish. That helps the owner see who is contacting them without exposing a private home address.

Mail can then go to the mailing address. Calls can go to the phone list. A rough call can simply say that you are a local investor interested in buying the property. Do not present a made-up address or identity as if it were real.

FAQ

Are wholesale deals always overpriced?

No. The buyer often pays for the wholesaler’s work and place in the deal. Run the house price and fee as one cost.

How long should I mail before expecting a deal?

Keep sending it. The source gives no promised time.

What list does Ross use in this example?

He starts with the full target county. The list then gives owner mail data and traced phone or email data.

What is driving for dollars?

It is noticing a property that appears neglected, finding the owner through the property data, and contacting that owner about a possible sale.