Santa Clarita Wholesale Attorney Steffanie Stelnick answers all your questions about this commonly misunderstood real estate transaction.

Property wholesaling takes a unique approach to selling property. 

But why do some people refer to it as the “real estate black market,” and is it a viable option? 

Let’s find out if wholesaling is the right option for you.

What’s Property Wholesaling? 

Wholesaling is a relatively new term in real estate that refers to the quick re-selling of homes. 

“In a wholesale, the seller works directly with the buyer – typically with no agents involved – which is very rare in real estate,” explained Steffanie Stelnick, Founding Partner of The Law Offices of Steffanie Stelnick. “Generally, there’s a third-party intermediary involved to represent your interests. Pulling that person out of the equation has both benefits and drawbacks that you should know about.” 

While these transactions can be done very quickly, for example, they also can leave you vulnerable. 

“A property is a significant investment, which is why it’s critical to have a real estate attorney review any legally binding property contract, including the wholesale of your property,” Steffanie added. “When it’s done with the proper guidance and expertise, wholesaling can be a fast-and-easy solution for the right seller.” 

How Does Property Wholesaling Work? 

Wholesaling is an investor strategy that has become more common in Santa Clarita and throughout California. Here’s how it works: 

The wholesaler (i.e. real estate investor) contracts a home with a seller at a specific price. Then the wholesaler finds and brings in a buyer, who is assigned the contract at a higher price. Instead of purchasing a home and selling it, a wholesaler contracts a home with the seller and buyer – then pockets the difference. 

Unlike a traditional real estate agent, a wholesaler does not need to pass an exam or have a license in order to complete the transaction, which is why it can be seen as the “real estate black market.” However, it’s a strategy often used by investors, as well as sellers who are looking to move quickly. 

What Are The Benefits Of Wholesaling?

“Wholesaling gives the seller control of their property, so they can sell it to a cash investor, no agents involved,” Steffanie explained. “That’s a huge difference for a lot of reasons.”

In a wholesale transaction, the wholesaler offers cash, and the seller nets the amount of the offer after any property encumbrance, such as a mortgage, is paid. The buyer covers all closing fees, as well. Once the sale is complete, the seller takes home the offer price – cash in hand. 

Additionally, a wholesale transaction can close in just five to seven days. That’s why it’s a great option for sellers who need to relocate quickly due to a professional opportunity, loss or other significant life event. This strategy allows the seller to liquidate their assets much faster than the traditional process. 

When Do I Need A Wholesale Attorney?

“In real estate, it’s rare for a seller to work directly with the buyer in a property transaction, which is why wholesaling can be quick and attractive in the right circumstances,” Steffanie explained. “But it’s also why there are a lot more requirements. That’s where we can help.” 

Often, there are no real estate agents or intermediaries in a wholesale property transaction, but the transactions can take place in a matter of days. That means it’s essential to have a team of expert legal professionals to ensure nothing falls through the cracks. 

Additionally, when wholesale contracts require a “double closing,” they can get into an ethical gray area if not done correctly. To ensure you’re staying within the scope of California law, it’s essential to consult a knowledgeable California real estate attorney.  

“We can review the purchase contract and review the offer, to help you determine whether or not it’s in your best interest to sell,” Steffanie explained. “Then we will let you know whether it’s in your best interest to sell the property wholesale or with a real estate agent in a traditional sale.”

Do you need a Santa Clarita wholesale attorney? Do you have questions about a real estate contract, transaction or property-related issue? We offer a complimentary consultation designed to help answer all your questions – and we don’t charge for phone calls. So please don’t hesitate to contact The Law Offices of Steffanie Stelnick today.

About The Law Offices of Steffanie Stelnick 

The Law Offices of Steffanie Stelnick is a full-service civil litigation law firm in California that focuses on real estate law, with cases in estate planning, probate, landlord and tenant disputes and contract disputes. Santa Clarita wholesale attorney Mrs. Steffanie Stelnick represents builders, small and large property management companies, investors, brokers and all types of real property owners. In 2020, she was recognized by the American Institute of Trial Lawyers as Litigator of the Year. Mrs. Stelnick believes all landlords and tenants should know their rights, and when it comes to representation, experience matters. The Law Offices of Steffanie Stelnick has handled thousands of real estate cases with a strong, aggressive approach that ensures all clients operate on an even playing field in a litigation environment. Founded in the Santa Clarita Valley, this premiere real estate law firm has offices throughout the state of California, including Encino, San Francisco and Sacramento.