Real Estate Assignment Fees: How Much to Charge and How They Work
The assignment fee is the wholesaler's profit on a deal. It is the difference between the price you contracted with the seller and the price the end buyer pays to take over your contract. There is no legal cap on assignment fees, but market dynamics, buyer expectations, and deal math all influence what you can realistically charge.
Typical assignment fee ranges
- Low-end ($3,000 to $7,000): Common on smaller deals with ARVs under $150,000, tight margins, or competitive markets where buyers have many options. Some beginners start at lower fees to build a track record and buyer relationships.
- Mid-range ($7,000 to $15,000): The bread and butter of wholesaling. Most deals in the $150,000 to $350,000 ARV range fall here. This is sustainable for both the wholesaler and the buyer.
- High-end ($15,000 to $50,000+): Possible on high-value properties, deep-discount acquisitions, or properties with exceptional upside. Fees above $20,000 to $25,000 may prompt some wholesalers to use a double close instead of assignment to keep the fee private.
How to calculate your assignment fee
The assignment fee is not something you "set" in isolation. It is determined by the spread between your contract price and what the deal is worth to a buyer. The calculation:
- Determine the ARV using comparable sales.
- Estimate repairs using repair estimation tools or contractor bids.
- Calculate the buyer's maximum price: ARV x 70% (or their target percentage) minus repairs.
- Your assignment fee is the difference between the buyer's max price and your contract price with the seller.
Fee calculation example
ARV: $280,000
Repairs: $50,000
Buyer's max at 70%: $280,000 x 0.70 - $50,000 = $146,000
Your contract price with seller: $130,000
Maximum assignment fee: $146,000 - $130,000 = $16,000
Realistic fee: $10,000 to $14,000 (leaving the buyer some cushion below their max)
A common guideline: set your assignment fee at 5% to 8% of the ARV. On a $280,000 ARV, that is $14,000 to $22,400. Adjust based on deal quality, buyer demand, and how quickly you need to sell.
Fee transparency in assignment deals
In an assignment transaction, your fee is visible to both parties on the closing documents. The buyer sees what you paid the seller. The seller sees what the buyer is paying. This transparency can create friction if either party perceives the fee as too large.
Most experienced buyers do not care about your fee as long as the deal works for them. They evaluate the deal based on their own numbers, not yours. Sellers are more likely to be surprised or uncomfortable, which is why many wholesalers prefer to keep the fee private by using a double close when the fee exceeds $15,000 to $20,000.
When to take a smaller fee
- Building relationships: Your first few deals with a new buyer are an investment in the relationship. Taking $7,000 instead of $10,000 to make the deal work for a buyer who might purchase your next 10 deals is a smart trade.
- Moving a tough deal: A property with issues (location, condition, title) may require a lower fee to compensate the buyer for the extra risk or effort.
- Thin margin: If the spread is small, taking $5,000 and closing the deal is better than holding out for $10,000 and having the deal expire.
- Building your track record: Closed deals matter more than large fees early in your career. Ten closed deals at $6,000 average build more credibility and buyer loyalty than two deals at $15,000.
Protecting your fee
Collect a non-refundable assignment deposit ($2,000 to $5,000) from the buyer when they sign the assignment agreement. This deposit is credited toward their purchase price at closing. If the buyer walks away, you keep the deposit. This protects you from buyers who commit verbally then disappear.
Related guides
- Assignment of Contract Explained
- Wholesale Real Estate Contracts Explained
- How to Wholesale Real Estate
- How to Find Buyers for Wholesale Deals
- What is an Assignment?
- What is MAO?
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