5 Steps to Maximizing Your Wholesale Assignment Fee


As a real estate wholesaler, setting the right assignment fee is key. The wholesale assignment fee is the money the end buyer will pay you to find their investment property. Set it too high, and buyers will balk at the cost. But set it too low, and you’ll be cheating yourself out of revenue. It’s a balancing act that requires some finesse. But ultimately, earning the highest assignment fee possible will increase your business’s profitability and help ensure that your wholesaling company can sustain itself for years to come. 

Wholesaling may be one of the easiest ways to join the real estate industry, but you’ll still need to put in quite a bit of work to build a profitable business. This includes strategic efforts to find the right buyer before the contract diminishes. Then you’ll need to reap the most significant assignment fee possible for each sale. If you manage these two steps, everything else will fall into place. So, are you ready to maximize your wholesale assignment fee and set your business up for success? Here are five easy steps to get things moving in the right direction.

1. Find the Maximum Allowable Offer

When it comes to wholesale assignment fees, you have the flexibility to choose the amount you earn. If you’re just starting, it may be beneficial to begin with a standard fee of less than $5,000 as a way to build your portfolio and client base quickly. However, other wholesalers choose to collect assignment fees based on the property.  For example, 15% of the final selling price or 5% of the original purchase price.

Understanding your Maximum Allowable Offer (MAO) will allow you to choose an assignment fee that benefits both parties. The MAO is a calculation that real estate investors use to determine the maximum amount they’re willing to pay for an investment property while considering renovation costs. When you know the property’s MAO, you can ask investors for the maximum assignment fee.

2. Understand the Market

As a real estate investor, you’ll need to understand how the market’s current conditions affect each wholesale deal. When prices are high, you may be able to demand a higher fee, but buyers may be less likely to follow through with a deal. On the flip side, when property values are low, you may make less on each deal but be able to close sales quickly.

You must also choose to conduct business in the most profitable neighborhoods possible. Therefore, it’s beneficial to learn the ins and outs of your area. Even a few blocks can make a big difference to a property’s value.

3. Negotiate 

The negotiation process begins long before you speak with a prospect, starting with in-depth research. You’ll need to understand your target audience, common objections, motivations, and other concerns before approaching with an offer. For instance, if you’re speaking with a seller, you should understand why they’re selling the property and how much they expect to earn. If you’re negotiating with a buyer, you should know their budget. Additionally, understand what they intend to do with the property, and how property amenities may influence their buying decision.

Once you understand who you’re contacting and why, you can begin negotiating a wholesale deal that benefits both parties. Of course, investors are interested in paying the lowest price possible for a wholesale property. However, remind them that paying a higher assignment fee ensures a higher quality of service. Communicate openly but precisely when speaking with prospects. Misinterpretations can make it significantly more challenging to accomplish your goals. However, when you clearly understand what you would like to achieve from each contact, the negotiation process moves along smoothly. Afterwards, you’re much more likely to maximize your assignment offer.

4. Double Close 

Double closing may require a little extra work. However, earning the greatest assignment fee is well worth the effort. In case you’re unfamiliar with the term, “double closing” occurs when a real estate wholesaler completes the deal in two separate transactions. In the first stage of the process, you will purchase the property outright from a motivated seller. Next, you will sell the property to an investor and collect the profit. 

The primary benefit of double closing is that you do not need to provide any information regarding the purchase price. This allows you to list the property for a higher asking price. In addition, buyers and sellers often view double closing as a more trustworthy option. In other words, they’re willing to pay a higher starting price for the property rather than purchase the property at market value and pay a separate assignment fee. Keep in mind that you’ll need to meet specific qualifications to purchase the property in the first place. Ensure that you meet the income and credit criteria if you’re interested in double closing.

5. Contact Motivated Sellers

Once you understand the negotiation process and the intricacies of wholesaling real estate, it’s time to supercharge your efforts with cold calling. Finding the right buyers and sellers can be tedious, and most prospects require multiple points of contact before committing to a wholesale deal. Allowing professional cold callers to function as the first touch point saves time and effort so your sales team can focus on closing the deal. 

Professional cold callers take the time to understand your company and the benefits of your services. They then devise a list of potential buyers or sellers and explain these benefits to each prospect with a script tailored to your ideal client, which increases your conversion rate and drives revenue. 

Find Sellers and Buyers with Call Motivated Sellers

The most difficult part about starting a wholesaling business and maximizing your wholesale assignment fee is finding buyers and sellers to start building your portfolio. So why not leave this to the experts? Get ahead of your competition with the assistance of Call Motivated Sellers. We’ll contact and vet potential buyers and sellers to find the best prospects, so you can focus on other aspects of your business.

Call Motivated Sellers is an American-based real estate cold calling service that can help raise your sales and provide hot leads year-round. We have years of experience cold calling in the real estate industry, along with access to the best information for buyers, sellers, and agents to help you close more leads.

Want to position your real estate wholesaling business for success? Contact our team today to learn more about our services!