How to Make an Offer on a Wholesale Deal (and Negotiate)

The basics

Your offer is a conversation, not a number

By now you've done the hard math: ARV, repairs and your maximum allowable offer. This lesson is about the part that makes new wholesalers nervous: sitting across from a homeowner and telling them a number.

Here's what took me a while to learn. Sellers who call a wholesaler usually have a problem: a house that needs too much work, an inheritance, a move, a tax bill. Price matters, but so do speed, certainty and not having to fix anything. When you understand their problem, the offer gets a lot easier.

Make your offer in person whenever you can. It's easier to build trust at the kitchen table than over the phone, and you can walk the repairs together.

Prepare

Know your numbers, your buyers and the seller's situation before you show up.

Present

Ask what they need, then show how you got your number.

Negotiate

Trade on terms before price, stay calm and know your walk-away.

Close

Get the agreed price signed on a purchase agreement before you leave.

Step by step

How to make your offer, step by step

Step 1: Prepare before you show up

Most offers are won or lost before you knock on the door. Pull your comps and estimate your ARV. Check your buyers list for buyers who buy in that area and what they pay. Run your MAO and decide your opening number.

Find out who needs to sign. If there are two owners on the deed or an heir who lives out of state, you want everyone who decides at the table, or at least on the phone.

Before the appointment

ARV and comps printed or on your phone
2 or 3 buyers who buy in that area
MAO and opening offer written down
Every decision-maker invited
Two copies of your purchase agreement

Step 2: Walk the house and build the repair list together

Ask the seller to show you around. Let them talk. They'll tell you about the roof leak, the old furnace and why they're selling. Write every repair down as you go, and take photos if they're OK with it (your buyers will want them).

Walking the repairs together does two things: your number won't surprise them, and they see that you're basing it on the house, not pulling it out of the air. Lesson 10 has a full walk-through checklist.

Checklist

Repair list written in front of the seller
Photos of the big items
Why they're selling, and when they need to move

Wholesaler and seller walking a dated kitchen while the wholesaler writes on a repair list

Step 3: Ask what they need before you name a price

Before you say a number, ask: "What were you hoping to get for the house?" and "If we could make this work, when would you want to close?" Then stop talking and listen.

Sometimes their number is below your MAO. Sometimes the closing date or not having to clean out the house matters more to them than the last few thousand dollars. You won't know unless you ask.

Step 4: Show how you got your number

Walk them through it in plain words: here's what fixed-up houses nearby sold for, here's the repair list we made together, and here's what an investor needs to leave for costs and profit. Show the comps.

When sellers see the math, a lower number feels fair instead of insulting. Be straightforward about who you are, too. If you plan to assign the contract, say so. Many states require you to disclose it, and it builds trust either way.

Step 5: Open below your MAO

Your first offer should leave room to negotiate, so open below your MAO. Keep it grounded in the numbers you just showed them. A number you can't explain feels like a lowball, and the conversation ends.

Say it with confidence, then be quiet. The first person to fill the silence usually gives something up.

Step 6: Negotiate on terms before price

If they counter, look for things that matter to them but cost you little: a closing date that fits their move, paying the closing costs, buying as-is so they don't have to fix or clean anything, or letting them stay a few extra days after closing.

Stay calm and friendly, even if they push back hard. Aim for a deal where both of you feel good. If you need a minute, ask for it. Never go above your MAO.

Things you can trade

Closing date that fits their plans
Who pays closing costs
Buying as-is, no cleanout needed
A few days to move after closing

Step 7: Know when to walk away

If the seller needs more than your MAO, thank them, tell them you can't make it work at that number, and leave your contact info. No deal is better than a bad deal.

Follow up. A seller who says no today might call back in a month when the house hasn't sold. Put a reminder on your calendar.

Step 8: Put it in writing before you leave

When you shake on a price, sign a purchase agreement right there. Fill in the price, the closing date, your inspection period and your earnest money, and go over every line with them. Give them a copy.

Use a contract made for your state, and have a local real estate attorney review it when you're starting out. My wholesale contracts page has templates, and lesson 14 covers contracts and exit strategies.

Checklist

Price, closing date, inspection period, earnest money
Assignment language your state allows
Signed copy left with the seller
Title company chosen (lesson 6)

Examples

Made-up examples to show how it sounds and how the numbers move. Your sellers and your numbers will be different.

Example

How the conversation can go

"Thanks for showing me around. Based on the list we made, the house needs a roof, a kitchen and new flooring. Before I give you a number, what were you hoping to get, and when do you need to be out?"

"Here are three houses like yours that sold after they were fixed up. Take off the repairs we listed, and what an investor needs to cover costs, and that's how I get to my number."

Example

How the numbers can move

Step	Price
Your MAO (walk-away)	$83,000
Your opening offer	$72,000
Seller's counter	$90,000
You offer to pay closing costs and close on their date	$76,000
Agreed and signed	$78,500

In this example you stayed $4,500 under your MAO, and the seller got the closing date they needed.

Avoid these

Mistakes to avoid

Showing up without your numbers

If you don't know your MAO, you'll either overpay or freeze.

Naming a price first

Ask what they need first. Their number might be lower than yours.

An offer you can't explain

Show comps and repairs. A number with no reasoning feels like a lowball.

Arguing with the seller

Stay calm and friendly. You're solving a problem together.

Going over your MAO

A contract over MAO isn't a deal. Walk away and follow up.

Leaving without a signature

If you agree on a price, sign the purchase agreement right there.

Recap

Lesson recap

Prepare: comps, ARV, repairs, MAO, buyers and every decision-maker.
Walk the house and build the repair list with the seller.
Ask what they need, then show how you got your number.
Open below MAO, trade on terms before price, never go over MAO.
Sign the purchase agreement before you leave.

Check your state. Wholesaling laws vary by state, including how you can market a contract and what you have to disclose. Read your state's rules, and ask a local real estate attorney if you're not sure.

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Averages up to 3 sold comps into an ARV, with price per square foot
Repair estimator with 19 line items
MAO = ARV x your buyer's % - repairs - your fee, with a go, negotiate or no-go signal
A buyer view and a rental view of the same deal

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FAQ

Lesson 13 FAQ

How do I make an offer on a wholesale property?

Run your numbers first: ARV, repairs and your maximum allowable offer. Then meet the seller, walk the house, and ask what they need. Show how you got your number, open below your MAO, negotiate on terms and price, and sign a purchase agreement when you agree.

Should I make offers in person or over the phone?

In person whenever you can. You can walk the repairs together, read the seller's body language and build trust, and you can sign the agreement on the spot. Phone and written offers work too, especially for out-of-area deals, but expect fewer of them to stick.

How low should my first offer be?

Low enough to leave room to negotiate below your MAO, but grounded in the comps and repairs you can show the seller. A first offer you can explain feels fair. A number with no reasoning feels like a lowball and can end the conversation.

What if the seller says no?

Thank them, tell them honestly that you can't make it work at their price, and leave your contact info. Then follow up in a few weeks. Many deals come from sellers who said no the first time and called back when the house didn't sell.

What goes in a wholesale purchase agreement?

The parties, the property, the price, the closing date, earnest money, an inspection period, who pays closing costs and, if you plan to assign it, assignment language. Use a contract built for your state and have a local real estate attorney review it.

Do I have to tell the seller I'm a wholesaler?

Wholesaling laws vary by state, and many states now require you to disclose that you plan to assign the contract or that you're selling your interest in it. Being upfront is the right thing to do anyway. Check your state's rules before you make offers.

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How to make an offer on a wholesale deal (and negotiate it)