Wholesale assignment fee: price the spread the end buyer can still pay

Written and reviewed by the Rehabfolio editorial team. Published and last reviewed October 5, 2026.

Who this guide is for. This guide is for a beginner who controls, or is about to write, a purchase contract on a one-to-four-unit house and wants to assign that contract to an investor who will renovate. It starts when you know your contract price and ends when you either advertise a fee the end buyer can still pay or you stop because the contract, the license rule, or the buyer's ceiling will not support it. If you plan to renovate the house yourself, use the renovation budget guide and the maximum offer guide instead. If you are still deciding what the finished house is worth, start with how to estimate after-repair value.

The Rehabfolio editorial team builds the wholesale assignment calculator and the property record that keeps a contract, an end-buyer screen, and seller follow-up together. That is first-hand product experience with the fee arithmetic and the file. It does not make the team a broker, a licensee, an attorney, an escrow holder, a lender, or a tax adviser. Dollar figures below are original teaching examples. They are not quotes, market averages, or results from a closed assignment.

Assignability, licensing, disclosure sentences, and cancellation rights differ by state and by the form you sign. This page is educational. It is not legal, brokerage, tax, or investment advice. The three state examples are illustrations of published rules in Texas, Illinois, and Oklahoma. They are not a survey of every state, and they are not a form you can paste into a contract.

1. Define the fee against the other prices

Beginners add one number to another and call the total profit. On an assignment there are at least five different numbers, and only one of them is the fee.

The end buyer price is what the assignee pays to step into your contract. After-repair value is what they hope a later retail buyer pays for the renovated house. Those dates and those buyers are different. If a wholesaler tells a seller "I can get you a sale at the ARV," they have mixed their own contract with someone else's exit.

Earnest money stays in its own lane. The earnest money guide covers who holds a buyer deposit, when a contingency can protect it, and how to avoid a bad wire. On a wholesale file the deposit is still that instrument. It becomes a cost only for the portion you expect to lose. A deposit the title company will credit or return is not profit and it is not an expense.

A double close is a different transaction. You take title from the seller and then deed the house to the end buyer, usually the same day or the next. You need the first purchase funded, and you pay closing costs twice. Some investors choose that path because the purchase contract forbids assignment, or because a lender on the end buyer's side wants a deed in the chain. The fee math in this guide is the assignment math. Do not relabel a double close as an assignment so you can skip a disclosure the property's state requires. This page does not explain how to conceal your price from a seller or a buyer.

2. Confirm what the contract lets you sell

An assignment sells your rights in a contract. It does not sell the house until someone who holds those rights actually closes and takes the deed. Before you quote a fee, read the assignability paragraph with a local lawyer or the broker who drafted the form. Many residential forms say the buyer may not assign without the seller's written consent. Some investor forms allow assignment. A few say the seller may withhold consent for any reason. The sentence in your file controls that file.

Write down four facts in plain language:

1. Are you allowed to assign, and is seller consent required?
2. Are you assigning the contract, or are you marketing the real estate as if you already own it?
3. What happens to your earnest money if the end buyer never appears?
4. What date kills the contract if you have not closed or assigned?

If the form forbids assignment, the fee you hoped to charge is not a number yet. You either renegotiate that paragraph, you plan a double close you can actually fund, or you do not put the contract in front of buyers. Guessing that "and/or assigns" in the buyer line overrides a later prohibition is how people market a contract they cannot deliver.

3. Build the end buyer's ceiling

The useful fee is the one that still leaves the end buyer's target profit. Rehabfolio's public wholesale assignment calculator uses this relationship, and you can run it without an account:

End buyer price = contract price + assignment fee.

Maximum purchase = (after-repair value - repairs - financing and holding - selling costs - target profit) / (1 + buying-cost rate).

Maximum fee = maximum purchase - contract price.

Your net before income tax = assignment fee - costs you will not recover.

Selling costs in that formula are a percentage of after-repair value, because the retail sale is sized off the finished house. Buying costs are a percentage of the price the end buyer pays you, which is why the formula divides instead of subtracting a flat guess. Financing and holding are the dollars they expect to carry from their closing through their exit. Target profit is theirs. A fee that feels fair to you can still miss their number.

Their after-repair value has to be a value for the finished house, built the way the ARV guide describes: closed sales of houses that match the condition they will deliver, with adjustments written down. An as-is sale, a Zestimate, or the price you wish they would pay is not that number. If the only repair figure you have is a photo screen, label it as a screen. The photo estimate guide is for that earlier pass. The end buyer's ceiling should use the repairs they will actually inherit, not a blended cosmetic number you typed to make a fee fit.

Income tax is outside the formula. Internal Revenue Service instructions for Form 4797 exclude inventory and property held primarily for sale to customers from the capital-gain treatment that form covers. A fee for assigning contract rights is not the same thing as gain on a house you deeded after holding it as an investment. Do not drop the fee on a long-term capital-gain line because the property was residential. Ask a tax professional which return line fits the way you actually did the business.

4. Put the 70% screen beside the detailed fee

Many end buyers still open with the 70% rule: 70% of after-repair value, minus repairs. The 70% rule guide treats that as a screen and the full cost stack as the decision model. On a wholesale file you need both, because the buyer in front of you may walk at the screen even when your detailed model shows a fee.

Compare the two ceilings to your contract price. If the buyer's 70% result is below your contract, there is no fee that satisfies that buyer. Cutting the fee cannot fix a contract that is already above their walk-away price. You renegotiate with the seller, you find a buyer who underwrites the full stack, or you drop the deal.

If both ceilings clear your contract, the fee you advertise should fit the test that buyer actually uses. Advertising the detailed-model fee to a buyer who has told you they buy only on the 70% screen wastes the inspection clock and your earnest money. The maximum offer calculator is the same comparison from the buyer's side of the table.

5. Read three state rules before you market

Fee math does not answer whether you may market the contract. The examples below are published rules in three states. They are not the rule on a house in a fourth state. Confirm the current text on the day you sign, because legislatures amend these sections.

Texas: disclose the equitable interest in writing

Texas Occupations Code section 1101.0045 says a person may acquire an option or an interest in a contract to purchase real property and then sell or assign that interest without a license issued under that chapter if two things are true. They do not use the option or contract to engage in real estate brokerage, and they disclose the nature of the equitable interest in writing to any seller or potential buyer. The same section says that offering the assignment without that disclosure is brokerage. Title 22, Texas Administrative Code, section 535.6 repeats the path and adds a further written disclosure when the person is already a license holder: they are assigning a contract interest and they do not have legal title.

A plain-language note can be the start of that disclosure. It is not a Texas Real Estate Commission form, and this guide will not pretend a sample sentence is enough. Have a Texas lawyer read the note against the contract you are actually using. Marketing the house as if you hold the deed, or agreeing to represent the seller for a fee, is a different activity from assigning your own contract.

Illinois: a pattern of contract dealing can require a broker license

The Illinois Department of Financial and Professional Regulation's summary of the Real Estate License Act, 225 ILCS 454/1-10, says licensed activity includes what people call wholesaling. The summary describes that pattern as buying, selling, offering, marketing, exchanging, or otherwise dealing in contracts, including assignable contracts and options. It states that an individual or entity needs a broker's license if engaged in that pattern at least twice in a 12-month period.

That is an agency description of a statute, not a personal safe harbor for a first deal. If you have already marketed one assignable contract in the last year, stop before the second and ask an Illinois real estate lawyer whether you need a sponsoring broker. A fee that looks small is still compensation for the activity the statute is talking about.

Oklahoma: missing disclosures can make the contract unenforceable by you

Oklahoma's published wholesale section, 59 O.S. section 858-314, as reprinted in the Oklahoma Real Estate Commission code book, requires a wholesaler to do three things. Disclose in writing to the homeowner, before the contract is signed, the intent to assign or sell the equitable interest for a higher price than the homeowner is offered. State in the contract, prominently, that the homeowner should seek legal advice. Disclose that the homeowner may cancel without penalty within two business days after execution. The Commission publishes a cancellation form the wholesaler is supposed to include at no cost.

The same section says a failure to include any required disclosure renders the contract invalid and unenforceable by the wholesaler and entitles the homeowner to any earnest money deposit involved. It also says a wholesaler's earnest money or security deposit stays in an escrow account in Oklahoma at a federally insured institution. Those are Oklahoma residential rules. They are not a suggestion to add a footer if you remember later. If the disclosures were missing at signing, the fee model is no longer the document that controls the file.

6. Keep earnest money, wires, and the fee apart

The assignment fee often moves by wire on a short deadline, which is the same pattern closing scams use. The Consumer Financial Protection Bureau's mortgage closing-scam guidance and the Federal Trade Commission's note on wiring money both describe last-minute changes to wiring instructions. Treat a new account number in an email as hostile until you confirm it by phone on a number you already had, not on a number in the email.

Match three amounts in the file before anyone sends money:

• The earnest money on the purchase contract, the receipt, and the escrow ledger.
• The assignment fee on the assignment, and the wire the end buyer was told to send.
• The end buyer price, which should equal the contract price plus that fee and nothing else slipped in as a "processing" line.

Your net is still the fee minus unrecovered costs. Do not add the earnest money back into the net if the escrow holder is returning it, and do not ignore it if the contract says you forfeit it when the buyer walks. The seller closing checklist is for a later deed. This file ends, if it ends cleanly, when the assignment is signed, the fee is received in the account the assignment names, and your purchase-contract deposit is credited, returned, or released under the purchase contract.

7. Use the assignment file checklist

You can fill this list on paper before you create an account. If any line is blank, you are not ready to promise the fee.

1. Contract price and assignability. Write the price, the assignment sentence, and whether the seller must consent.
2. What you are selling. Contract rights, not a deed you do not hold.
3. Disclosure status. Note whether the property's state requires a written equitable-interest disclosure, a license, or a cancellation window, and whether that step is done.
4. End buyer after-repair value. Closed comps for the finished house, with the source named. See after-repair value.
5. End buyer repairs. Their scope, or a photo screen clearly labeled as a screen. See estimating from photos.
6. Their other costs and target profit. Selling costs, buying costs, financing, holding, and the profit they still require.
7. Maximum fee and advertised fee. If the advertised fee is higher, change the fee or the contract before you send the package.
8. 70% screen. Record their screen and whether they treat it as a hard walk-away. See the 70% rule.
9. Earnest money. Amount, holder, deadline, and whether you expect it back. See earnest money.
10. Unrecovered costs and your net. Marketing and any deposit you will lose. Leave income tax off this line.
11. Wire check. Account name confirmed on a known phone number. No emailed changes accepted.
12. Next action. One owner and one date, the way the four-stage pipeline describes, so a live deposit is not invisible while you shop the contract.

8. Work three named investor scenarios

These stories are original composites. Names, cities, and figures are invented for teaching. They are not testimonials, client files, or promises about fees, licenses, or refunds.

Scenario A: Andre Brooks will not shop a fee the buyer's screen rejects. Andre has a $168,000 contract on a 1962 ranch in Fort Worth. He wants a $10,000 assignment fee. One buyer he knows buys only when the 70% rule clears. On a $305,000 after-repair value and $48,000 of repairs, that screen is $165,500, which is $2,500 under Andre's contract. There is no assignment fee that fixes it. Andre does not email that buyer a package. He keeps a second buyer who underwrites the full cost stack, and he does not quote the fee until the worked example in the next section shows the stack still clears. He also has his Texas lawyer review a written note that he is assigning contract rights and does not hold legal title, and he gives that note to the seller and to the potential buyer.

Scenario B: Nina Patel's fee dies because the Oklahoma disclosures were never in the contract. Nina has a $142,000 contract on a 1954 bungalow in Oklahoma City and a hoped-for $18,000 fee. She did not, before signing, disclose in writing that she intended to assign her equitable interest for a higher price. The contract also lacks the prominent legal-advice notice and the two-business-day cancellation disclosure described in 59 O.S. section 858-314. Her earnest money is $3,000. The published statute says a missing required disclosure makes the contract invalid and unenforceable by the wholesaler and entitles the homeowner to the earnest money involved. Nina stops marketing the contract and calls an Oklahoma real estate lawyer before she texts the seller again. She does not ask the end buyer to wire $18,000 against a contract the statute says she cannot enforce.

Scenario C: Camille Ortiz does not market a second Illinois contract on a spreadsheet fee. Camille assigned one Chicago-area contract in March. In September she has a $190,000 contract on a 1971 split-level in Aurora and an $8,500 fee written in the margin. She is not a licensed broker. The Illinois regulator's summary of 225 ILCS 454/1-10 describes a broker license as required when the pattern of dealing in assignable contracts happens at least twice in a 12-month period. September is inside that window. Camille does not send the buyer list. The $8,500 stays a cell in a spreadsheet until Illinois counsel, and a sponsoring broker if counsel says she needs one, tells her she may market it. A small fee is not a small exception.

9. Follow one complete fee calculation

Andre's full-stack buyer, the second buyer in Scenario A, uses these teaching assumptions. They are not Fort Worth quotes.

Maximum purchase = ($305,000 - $48,000 - $11,000 - $24,400 - $40,000) / 1.02. The numerator is $181,600. Divided by 1.02, the maximum purchase is $178,039 when rounded to the nearest dollar. Maximum fee = $178,039 - $168,000 = $10,039. Andre's $10,000 fee sits just under that ceiling.

Check the buyer's profit at the price they would actually pay. Buying costs are 2% of $178,000, which is $3,560. All-in cost is $178,000 + $48,000 + $3,560 + $24,400 + $11,000 = $264,960. Profit is $305,000 - $264,960 = $40,040, which clears a $40,000 target by $40. Andre's net before income tax is $10,000 - $800 = $9,200. The $2,500 deposit is not in that net, because he expects the escrow holder to return or credit it.

The same buyer's 70% screen is still $165,500. Andre already decided not to send the file to a screen-only buyer. The detailed buyer is a different person with a different rule. Writing both numbers on the package keeps him from "forgetting" which buyer he is talking to when someone asks for a discount.

Move one input and watch the fee move

If the rehab bid comes in $8,000 higher, repairs are $56,000. The maximum purchase falls by $8,000 / 1.02, and the fee room falls from about $10,039 to about $2,196. Andre cannot keep a $10,000 advertisement. He cuts the fee, he cuts the contract with the seller, or he walks.

If after-repair value falls by $10,000, selling costs also fall by 8% of that drop, which is $800. The numerator falls by $9,200, and the maximum purchase falls by $9,200 / 1.02. Fee room is about $1,020. A modest comp miss removes almost the entire fee. That is why the ARV source belongs in the file before the buyer list does.

Andre's decision on the original inputs: advertise $10,000 only to the full-stack buyer, only with the written equitable-interest disclosure his lawyer approved, and only while the contract still allows assignment. He does not call the $9,200 net a capital gain, and he does not call it a closed profit until the fee is actually received.

10. Use a repeatable Rehabfolio workflow

1. Put the contract facts on the property. Price, assignability, consent, deposit, and the date the contract dies.
2. Run the public calculator before you promise a fee. The assignment calculator uses the same ceiling as this guide. Change repairs or ARV and read the maximum fee again.
3. Store the end buyer's evidence. Comps, the repair scope, and the profit they require stay next to the fee. Deal analysis is where those assumptions live once you are in a workspace.
4. Track the seller with one next action. The wholesale workflow and the pipeline guide are the follow-up, not a second copy of the fee math.
5. Block marketing when a legal line is blank. License, disclosure, and cancellation status are facts in the file. A model can draft a comparison from numbers you typed. It cannot tell you that Texas, Illinois, or Oklahoma law is satisfied.
6. Separate the money. Earnest money, assignment fee, and unrecovered costs stay on different lines through closing of the assignment.

Rehabfolio does not hold the fee, does not send the wire, and does not decide if your contract is assignable. Plan limits are on pricing. The AI disclosure covers drafts: you accept or reject the numbers. The brand of a model does not turn a missing Oklahoma disclosure into a collectible fee.

Frequently asked questions

Editorial methodology, limitations, and sources

The Rehabfolio editorial team chose this topic because the assignment calculator and the wholesale use-case page already existed, and every other public calculator already pointed at a long guide. The library did not yet explain the fee as its own job. The earnest money guide remains the home for purchase-contract deposits. The after-repair value, photo estimate, repair budget, and 70% rule guides remain the home for the end buyer's value, the early scope, the walkthrough budget, and the offer screen. This page is only the spread between your contract and a buyer who can still perform.

Key sources include Texas Occupations Code section 1101.0045 and 22 Texas Administrative Code section 535.6. The Illinois Department of Financial and Professional Regulation's Real Estate License Act update summarizes 225 ILCS 454/1-10 on wholesaling as a pattern of dealing in contracts at least twice in 12 months. The Oklahoma Real Estate Commission's code and rules book reprints 59 O.S. section 858-314, including the pre-contract disclosure, the two-business-day cancellation right, escrow for the wholesaler's deposit, and the effect of a missing disclosure. The Commission's wholesaling resource includes the cancellation form dated for use in 2026. IRS Instructions for Form 4797 exclude inventory and property held primarily for sale to customers from the section 1231 treatment that form reports. The Consumer Financial Protection Bureau's closing-funds guidance and the Federal Trade Commission's wiring article support the wire check. Those pages do not set your fee or your state's license rule.

Public guidance cannot tell you whether a particular contract allows assignment, whether you personally need a license, or what a buyer in your city will pay this month. Examples are original composites. Names, cities, and figures are illustrative. They are not testimonials or performance claims. Replace every assumption with the contract, the comps, the bids, and local counsel before you rely on it.

Editorial standard. We identify the audience, author, review date, topic boundary, assumptions, calculations, product limits, and sources. We do not invent credentials, licenses, testimonials, market statistics, or guaranteed fees. AI may help organize research and draft, and a person reviews the claims, calculations, links, examples, and limitations before publication. We revise the guide when a cited statute, a product formula, or a material assignment practice changes. See the editorial methodology.