Questions to Ask When Wholesaling Real Estate
Questions for the seller call and the walkthrough when you intend to put a property under contract and assign it. They cover motivation, title, condition, price and the terms that decide whether a deal is assignable, plus the disclosures a seller is owed.
The questions
Open any question for the note
Tell me about the property. How did you come to own it?
Why ask it
An inherited house, a rental someone is tired of and a home the owner raised children in are three different negotiations. This also tells you early whether the person on the phone actually owns it.
What has you thinking about selling now rather than last year?
Why ask it
Motivation is a specific event most of the time: a job move, a tenant who stopped paying, a probate that has closed, a repair estimate they cannot fund. If nothing has changed, expect a seller who will test the market instead of taking a discount.
If we could close on your schedule, when would you want to be out?
Why ask it
The date is often worth more to a seller than the last few thousand dollars, and it is the term you can give away cheaply. A vague answer usually means the decision has not really been made yet.
Who is on the title besides you, and is everyone on the same page about selling?
Why ask it
Siblings on a deed, an ex-spouse who was never removed, or an estate without a personal representative will each stall a closing for weeks. Better to learn it now than after you have a buyer waiting.
Is there a mortgage on the property, and roughly what is the payoff?
Why ask it
Payoff plus liens plus closing costs sets the floor under any price you can offer. A seller who owes more than the house is worth is a short sale, which is a different transaction with a different timeline.
Are the property taxes current, and are there any liens, judgments or unpaid utility bills attached to it?
Why ask it
Sellers routinely forget a contractor's lien or a city water balance, and both come out of proceeds at closing. Ask, then have title verify, because the seller's memory is not a title search.
Is anyone living there now, and is there a written lease?
Why ask it
An occupied property narrows your buyer pool to investors and can carry tenant protections that survive the sale. A relative living there rent-free with no lease is the version that most often blows up a closing.
When were the roof, furnace, water heater and electrical panel last replaced?
Why ask it
These four items decide whether your repair number starts at fifteen thousand or fifty. If the answer to all four is "I am not sure", price the deal as though each is at the end of its life.
Has water ever come into the basement or crawlspace, and did it leave damage?
Why ask it
Water history is the defect buyers walk away from latest and most expensively. Note the exact words used, since "only in a heavy rain" is a yes and needs to be disclosed onward to your buyer.
What repairs would you point out yourself, and what have you been putting off?
Why ask it
Asking the seller to volunteer problems usually produces two or three you would not have found in an hour walkthrough. It also sets a cooperative tone before you talk about price.
Was any of the work done without permits: a finished basement, an added bedroom, a converted garage?
Why ask it
Unpermitted square footage can fail an appraisal, complicate insurance and cost your end buyer a retroactive permit process. It is also the most common reason a bedroom count in your marketing turns out to be wrong.
Are there open code violations, city citations or an HOA in the picture?
Why ask it
Municipal cases and HOA arrears follow the property, and some cities require a certificate of occupancy or inspection before transfer. Any of these can add weeks that your assignment deadline does not have.
Has the property been listed with an agent, and is that listing still active?
Why ask it
An unexpired listing agreement can make the agent owed a commission on your purchase, which quietly deletes your margin. Ask for the expiration date rather than a yes or no.
Have you had other offers, and what happened with them?
Why ask it
A deal that fell out of contract twice tells you either the title is messy or an inspection scared someone. The reason it failed is usually the same reason yours would.
How did you arrive at the number you have in mind?
Why ask it
A price from a neighbor's sale, an online estimate or a figure needed to pay off debts each respond to different evidence. You cannot move a seller off a number until you know what is holding it up.
If I paid cash and closed on your date with no repairs on your side, what is the number that works for you?
Why ask it
Naming the trade-offs before the price keeps the conversation about the whole offer rather than a single figure. Silence after this question is normal; let it sit rather than filling it with a higher number.
Besides price, what else needs to happen for this to work for you?
Why ask it
Time to move, leaving the furniture behind, keeping a shed, staying two weeks after closing: these cost little and often close the last gap. Sellers rarely offer them unless asked directly.
I want to be clear that I may assign this contract to another buyer rather than close in my own name. Is that all right with you?
Why ask it
Saying it plainly at the table is both fair and protective, because a seller who learns it at closing may refuse to sign. If the answer is no, you have found out while you can still restructure or walk.
Who else is involved in this decision, and do they need to hear this from me?
Why ask it
A spouse, an adult child or an attorney who was not on the call will re-litigate the price later. Getting them into the conversation early costs one meeting and saves a dead contract.
If we cannot agree on a price, what will you do with the property instead?
Why ask it
The real alternative might be listing it, renting it, or nothing at all for another year. A seller with no other option is not someone to squeeze; a seller with a good option is telling you your offer needs to be stronger.
Working the call and the contract
Practical guidance for the conversation itself
How to run the conversation
Spend the first ten minutes on the property, not the price
Sellers who feel interrogated about money stop volunteering information. Condition and history questions give you what you need to price the deal and give them a chance to raise problems themselves.
Take the numbers you are given as claims, not facts
Verify payoff, taxes, liens and ownership through a title company, and verify square footage and permits through county and city records. Sellers are wrong far more often than they are dishonest.
Say what you are out loud
Tell the seller you are an investor, that you intend to assign the contract, and what your inspection and financing contingencies mean. Wholesaling gets its bad name from the deals where none of that was said.
Know your own rules before you market
Requirements for assignment, disclosure and licensing differ by state and several have tightened in recent years. Check what your state requires before you build a process around a contract template you found online.
The numbers to have before you offer
- 1Comparable sales within a short radius that are recent and genuinely similar, not the highest three you can find.
- 2A repair estimate built from the roof, mechanicals, kitchen and bath, plus a contingency for what is behind the walls.
- 3The payoff, tax balance and any liens, confirmed rather than remembered.
- 4What an end buyer in your area will actually pay as a percentage of resale value, based on your last few deals or theirs.
- 5Your own spread, and the smallest one you would still do the work for.
- 6The inspection period and closing date you need, and whether the seller can live with them.
Where these deals fall apart
Contracting before you have a buyer
An assignment with no buyer is an obligation with a deadline. If you tie up a property speculatively, keep an earnest money amount and an inspection period you can afford to walk away from.
Repair numbers built from a phone photo
The gap between an optimistic estimate and a contractor's bid is where the spread disappears. Walk the property, or send someone who will, before the inspection period closes.
Assigning to a buyer who cannot close
Proof of funds pulled from a template means nothing. Buyers who have closed with you before, or who will let you speak to their lender, are the reason a deal funds on time.
Leaving the seller worse off
Chains of assignments, hidden fees on a settlement statement and pressure on a distressed owner are how markets get regulated and reputations end. The deal has to be one you could describe to the seller in full.