Passive investor here, two deals in front of me and I cannot figure out which one actually makes sense for me

The thing I have never seen work is the "motivated seller, no contract yet, but come in on the front end" structure when the person asking you in is a wholesaler who needs your capital to even get to a signed agreement. What happens instead is the 40k sits in escrow or worse just sits with them informally, the seller gets a better offer or gets cold feet, and you are chasing a refund from somebody who already spent the float on their next deal. You said you were burned once at title, this is earlier than title. There is no title to even get to yet. The 90 to 110k projected split is always the number that gets quoted before a contract exists and almost never the number that survives an actual negotiation with a motivated seller who has other options the moment word gets out.

On the Scottsdale side, 68k on a 1.4M assignment does feel thin until you hold the math the right way. If you are actually buying and holding 18 months in that Scottsdale zip, the assignment fee is just your acquisition friction, not your return. Your return is whatever the asset does. I closed on a property in north Scottsdale in early 2022 at 1.55M, sold 20 months later at 2.05M, and the 55k I paid in assignment and transaction costs was basically noise against that spread. The question I would actually be asking is whether the 1.4M basis is clean, whether the comp support holds for what you think an 18-month exit looks like, and whether the 31-day close is real or aspirational. Defined paperwork and a close date are worth a lot when the alternative is 40k in the wind on a handshake.

The PV deal math only looks better if you trust that the spread holds, and in my experience in the 2-3M range in Paradise Valley specifically, spreads get negotiated down hard once title opens and everybody starts seeing each other's numbers. I did a co-principal structure on an off-market in Arcadia two years back, 1.8M purchase, wholesaler had the seller relationship and I had the capital, we agreed to split net above a certain floor. By the time we got through title, two rounds of price drops after inspection, and the seller's attorney getting involved, my 35k earnest was at risk for about 11 weeks and we ended up netting 62k split two ways. Thirty-one thousand dollars for 11 weeks of exposure on a deal where I had no contract protection until week three. The structure sounded like it could hit 120k on the upside when we shook on it.

The thing I have never seen work is putting deposit money into a co-principal arrangement before there is a signed PSA with your name or your entity on it as a principal. What happens instead is you are a handshake partner until the contract gets signed, and if the wholesaler decides to restructure the deal, bring in a different money partner, or the seller walks, you have no standing to recover that earnest through title. You are just chasing someone informally. The Scottsdale deal at 68k with a 31-day close and paperwork already done is not thin, it is defined. On a 1.4M luxury assignment in Scottsdale right now that is a real number with a real exit date and you know exactly what you are buying into.

The 40k earnest on a deal with no signed contract yet is not earnest money, it is a donation with extra steps. I put 35k into a pre-contract situation in Tempe back in 2021, wholesaler swore the seller was locked in, title found a trust dispute two weeks out and the whole thing evaporated. Took eight months to get 22k back through mediation and I never saw the other 13. The Scottsdale one at 68k feels thin until you remember that thin and certain beats fat and theoretical every single time at this price point. PV deals fall apart at title more than people talk about publicly because nobody wants to post the loss.

Scottsdale is 68k with a ceiling; PV is 40k at risk with no floor yet.

Already got burned once, that is your answer right there.

The spread on the Scottsdale deal is what I would be stress-testing before anything else, not which deal feels cleaner. 68k on a 1.4M buy is 4.8 percent, and if whoever is flipping this thing is projecting an 18-month hold, I want to see their comps for what PV and Scottsdale luxury actually did in Q1 and Q2 this year because that segment has been sitting longer than people admit. The co-principal structure on the PV side sounds like the wholesaler needs your money to control a deal he cannot fund himself, which means you are carrying his risk while he pitches you the upside number, and 90 to 110k is a projection with no contract behind it yet. I would go back to the Scottsdale wholesaler and ask for the title commitment, the assignment agreement, and the seller's original purchase price before I moved anywhere near a wire. If the paperwork is real and the ARV math holds at 1.4M in, I would rather take the defined number on a signed deal than 40k exposed on a handshake in Paradise Valley right now.

Earnest money with no executed contract is a gift, not a deposit.