JB PARCELWholesale Assignment Fee Calculator
Wholesaling is arithmetic in two directions. Work out what your end buyer can pay, subtract your fee, and that is your contract price. Get it backwards and you tie up a house nobody wants.
How this calculator works
Work backwards from your buyer. Their maximum offer sets the ceiling on the whole transaction, and everything else has to fit underneath it. Two ways to find that ceiling: the rule of thumb they use, usually seventy percent of ARV minus repairs, and their real cost math, which subtracts repairs, holding, selling costs, closing costs, and their required profit from ARV. Use whichever is lower, because a buyer who runs the numbers will.
Your maximum contract price is that ceiling minus your assignment fee. If your buyer tops out at $160,600 and you want $12,000, you cannot contract above $148,600. Tie it up higher than that and you own a contract nobody will take, which usually ends with you losing your earnest money and your reputation with that buyer.
Your net is not your fee. Subtract what it actually cost you to find the deal, which is your total marketing spend divided by deals closed, not the cost of the specific mail piece that worked. If you spend $30,000 a year and close twelve deals, every deal carries $2,500 whether you think about it or not.
Double closing changes the math. If the deal has to be double closed rather than assigned, whether because of title issues, a seller who objects, or a lender who will not allow an assignment, you pay two sets of closing costs and Tennessee transfer tax applies to both transfers. Model it before you commit to a structure.
Worked example: a Chattanooga wholesale
ARV $298,000, repairs $48,000, buyer works on 70 percent and needs $40,000 of profit.
| Buyer's MAO by the rule | $160,600 |
|---|---|
| Buyer's MAO by real costs | $163,690 |
| Ceiling (the lower one) | $160,600 |
| Your contract price | $145,000 |
| Assignment fee available | $15,600 |
| Buyer's profit at your price | $46,690 |
| Your net after marketing | $13,100 |
The deal works, and it works with room. Here the buyer's rule of thumb is $3,090 tighter than their own cost math, so the rule binds. Raise their holding costs to $30,000 or their required profit to $50,000 and the real-cost number drops below the rule, and the rule stops protecting you. Run both every time and underwrite to the lower one, because that is the number your buyer will walk on.
Questions investors ask
Is wholesaling legal in Tennessee?
Assigning a contract you genuinely entered into as a buyer, with the intent and ability to close, is generally lawful. Marketing a property you do not own or control to the public, on the other hand, looks a great deal like brokering without a license, which Tennessee requires a license for. The line is real and it matters. Use a written contract with a clear assignment clause, disclose your position and your intent to assign in writing to the seller, and have a Tennessee real estate attorney review your paperwork and your process before you scale. Nothing on this page is legal advice.
What is a normal assignment fee?
Five to fifteen thousand dollars is the typical range on a mid-priced Tennessee house, with larger fees on higher-value properties or unusually deep discounts. The fee is not really the question, though. The question is whether the deal still leaves your buyer a real profit after your fee, because that is what determines whether it closes and whether that buyer takes your next call.
Should I disclose my assignment fee to the seller?
Disclose that you are purchasing as a principal and that you intend to assign the contract, always and in writing. Whether the specific dollar amount gets disclosed depends on your contract and how you close. On an assignment, the fee typically appears on the settlement statement and is visible. Trying to hide it is how deals fall apart at the closing table.
What if I cannot find a buyer?
You either close on it yourself, negotiate an extension, or lose your earnest money and terminate under whatever contingency you have. That is exactly why you build a buyer list before you tie up a property, and why your earnest money should be sized to a number you can afford to lose. Contracting a house with no realistic buyer is the fastest way to burn a seller relationship in a small market.
Assignment or double close?
Assign when you can. It is cheaper, faster, and involves one set of closing costs. Double close when the seller objects to an assignment, when the title company requires it, when a lender prohibits it, or when the spread is large enough that you would rather not have it visible on a single settlement statement. Budget for the second set of closing costs and for Tennessee transfer tax on both legs, and model it in Advanced options.
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Screening a real property? Pull its appraised value, assessed value, acreage, land use, and last recorded sale off the JB PARCEL parcel map and drop the real numbers into this calculator instead of guessing. Coverage runs across every county we carry.