No Middlemen: What Wholesalers Don’t Tell You
Some “cash buyers” never buy your house. They sign a contract, then look for someone else to buy it. Here’s how that works, what to look for in your contract, and the one question to ask every cash buyer.
- How assignment contracts and double closes work
- What “and/or assigns” means in your contract
- Warning signs and questions to ask
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Buyer or middleman?
When you sell your house for cash, you’d expect the company that signs your contract to be the one that buys it. A lot of the time it is. But some companies are wholesalers: they put your house under contract without planning to buy it. Instead, they find another buyer, often an investor, and sell that buyer the right to purchase your house for more than you agreed to.
Wholesaling is common, and some wholesalers are upfront about it. The problem is when nobody tells you. You think you’ve sold your house, while your contract is really being shopped around to people you’ve never met.
How an assignment contract works
- You sign a purchase contract with the wholesaler, usually at a price that leaves room for their fee.
- They market your contract to other buyers, sometimes with photos of your house and a walkthrough or two.
- If they find a buyer, they “assign” the contract to that buyer for a fee. The new buyer is the one who actually closes.
- If they don’t find a buyer, the deal can stall, they may ask you for a lower price, or they may cancel during their inspection period.
How a double close works
A double close (sometimes called a simultaneous close) is another way to do the same thing. There are two sales back to back, often on the same day: the middleman buys your house from you, then sells it to their end buyer right away, usually using the end buyer’s money. On paper the middleman “bought” your house, but they never planned to own it, and you usually never see what the house really sold for.
The “and/or assigns” clause
Look at the buyer’s name on your purchase contract. If you see something like “Buyer: [company name] and/or assigns,” that wording lets the buyer hand your contract to someone else. It’s the most common sign that the company signing isn’t necessarily the company buying.
You’re allowed to ask them to take it out. If a buyer really plans to close, it shouldn’t be a problem. If they won’t, ask why.
Warning signs to watch for
None of these proves anything on its own, but if you see a few of them, slow down and ask questions.
“and/or assigns” after the buyer’s name
It means the contract can be handed to someone else.
A long inspection or “due diligence” period
Weeks with an easy way out can be time to shop your house to other buyers.
A tiny deposit, or one that shows up late
A buyer who plans to close usually puts real money into escrow right away.
A parade of “partners” and “contractors”
Lots of strangers walking through can mean your house is being marketed to other buyers.
Your house showing up in ads you never approved
Photos of your home sent around to buyer lists or posted online.
A lower price right before closing
A new number with no new facts often means they couldn’t find a buyer at the first price.
Pressure to sign today
A real buyer will give you time to read the contract and ask questions.
No straight answer about who closes
If they can’t tell you whose name goes on the deed, that tells you something.
Questions to ask any cash buyer, including us
Ask every cash buyer one question first: “Are you buying my house?” Then keep going:
- “Are you buying my house?”
- “Whose name will be on the deed after closing?”
- “Does the contract say ‘and/or assigns’? Will you take it out?”
- “Are you planning a double close, with two escrows on the same day?”
- “Whose money is paying for this?”
- “How much is the deposit, and when does it go into escrow?”
- “When could the price change, and what would you show me if it did?”
- “Which escrow and title company will we use?”
Get the answers in writing, and have a real estate attorney look over the contract if anything is unclear.
How Trident is different
We buy it. We fix it. No middleman.
- We’re the buyer. Trident buys your house with our own cash and closes in our own name. No assignments, no double closes.
- No “and/or assigns.” Our purchase contracts name us as the buyer, and that’s who closes.
- Same price at closing. The price we offer is the price we pay, unless the inspection finds something we didn’t know about, and we’ll show you why.
- We fix it ourselves. We buy as-is, then do the repairs after closing. That’s how we’ve bought and sold 359 Southern California homes since 2011.
- Not the right fit? We still help you sell. If a cash sale to us doesn’t make sense, we’ll say so, and we can list it for you, refer you to a local agent, or connect you with another local buyer. Either way, you’ll know who is buying before you sign.
- A neutral closing. A licensed escrow and title company holds the money and pays you at closing.
Quick questions
Are you a wholesaler?
No. We’re the buyer. When we put your house under contract, Trident buys it with our own cash and closes in our own name. We don’t assign your contract to anyone else, we don’t do double closes, and our purchase contracts don’t include “and/or assigns.” The people you meet are the people who close. Curious how wholesaling works? Read No Middlemen: What Wholesalers Don’t Tell You.
Will my price change at closing?
No. The price in our written offer is the price we pay at closing. The one exception is if the inspection finds something we didn’t know about, like a broken sewer line or foundation damage that nobody mentioned. If that happens, we’ll show you exactly what we found and why it matters, and talk it through with you before anything changes. We don’t come back near closing asking for a lower price for any other reason.
What if my house isn’t a fit?
We’ll tell you up front, and we’ll still help you sell. Depending on what works best for you, we can list it on the open market for you, refer you to a good local agent, or connect you with another local buyer. Whatever the option, we’ll tell you plainly who would be buying and how, before you sign anything.
This page is general information, not legal advice. Not every wholesaler works the same way, and contracts vary. Read yours carefully and talk to a real estate attorney about your situation. Also see our guide to telling a real cash buyer from a middleman, our free seller’s guide and our FAQ.
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