What to check as the end buyer when a wholesaler's fee shows up on the settlement statement
Consider a first purchase coming from a wholesaler two states away from the house, a 1960s 3 bed slab ranch in a stable blue collar neighborhood with a tenant in place at $1,050. The wholesaler has it under contract at $83,000 and offers it at $92,000, upfront about the fee, which is the detail that makes a buyer take the call seriously. What a careful buyer should ask for before signing anything, especially on a first deal on this side of a transaction: 1. A copy of the original purchase agreement between the wholesaler and the seller, unredacted, to see the price, the closing date, and whether the seller signed anything acknowledging the resale. A seller disclosure signed at contract is a strong signal worth looking for.
- The assignment agreement itself, read closely, since the buyer is purchasing the wholesaler's position in a contract, not the house directly, and that distinction changes what happens if the seller does not perform.
- The title commitment, read line by line, watching for small liens, for example a municipal lien from a code case, that can become a negotiating point.
- Confirmation the fee will appear on the settlement statement rather than being paid outside closing. How fees get shown and what a lender will allow varies, so this is worth confirming with the lender in writing first. A common friction point is a lien surfacing days before closing, with the wholesaler initially wanting the buyer to absorb it. A split is a fair counter, and a wholesaler agreeing quickly usually signals their fee has room in it. The habit worth keeping from a deal like this: always ask for the seller-side contract. Anyone unwilling to show it is telling a buyer something important.
