Wholesaling Real Estate in PA: A Beginner's Complete Guide

What Is Wholesaling?

Wholesaling is the process of finding a property under market value, putting it under contract with the seller, and then assigning that contract to an end buyer (usually an investor or flipper) for a fee. You never actually buy the property — you're essentially connecting motivated sellers with ready buyers and earning an assignment fee for facilitating the deal.

Think of it like being a matchmaker for real estate deals. The seller gets a quick sale, the buyer gets a property below market value, and you earn a fee for making it happen.

Is Wholesaling Legal in Pennsylvania?

Yes — wholesaling is legal in Pennsylvania. However, there are important guidelines to follow. You need to be transparent about your role in the transaction. Pennsylvania law requires that you disclose you're assigning the contract, not purchasing the property yourself. You should also be careful about marketing the property itself versus marketing your contract — there's an important legal distinction.

While you don't need a real estate license to wholesale in PA, having one (or working with a licensed brokerage like Mega Realty) gives you access to the MLS, more credibility with sellers, and legal protection. Many successful wholesalers eventually get licensed to expand their toolkit.

Step 1: Finding Motivated Sellers

This is where most beginners struggle. Motivated sellers are property owners who need to sell quickly — typically due to financial distress, inherited properties, divorce, job relocation, or properties in disrepair. Here are the most effective ways to find them:

Driving for dollars is still one of the best methods. Drive through neighborhoods looking for signs of distressed properties — overgrown lawns, boarded windows, code violation notices. Use an app like DealMachine to instantly pull the owner's information and send them a letter or make a call.

Direct mail campaigns targeting absentee owners, pre-foreclosures, and probate leads can generate consistent deal flow. The key is volume and consistency — don't send 100 letters and give up. Plan for at least 1,000 touches over several months.

Cold calling and texting from skip-traced lists is faster than mail but requires more effort and thicker skin. Use lists from sources like PropStream or BatchLeads, skip trace for phone numbers, and call systematically.

Step 2: Running Comps and Analyzing the Deal

Once you find a potential deal, you need to determine the After Repair Value (ARV) and estimate repair costs. The ARV is what the property would sell for in good condition. Pull comparable sales from the last 3-6 months within a half-mile radius that are similar in size, bedrooms, and condition.

A common formula wholesalers use: Maximum Allowable Offer = ARV × 70% - Repair Costs - Your Assignment Fee. So if a property's ARV is $200,000, repairs are $30,000, and you want a $10,000 assignment fee, your max offer would be $100,000.

Step 3: Making the Offer and Getting Under Contract

Use a purchase agreement that includes an assignment clause — something like "Buyer and/or assigns" in the buyer name field. This gives you the legal right to assign the contract. Be upfront with the seller about your intentions. Many wholesalers try to hide what they're doing, but transparency builds trust and avoids legal issues.

Include an inspection contingency period (typically 10-14 days) which gives you time to find a buyer and do additional due diligence without risking your earnest money.

Step 4: Finding Your End Buyer

This is where your buyers list comes in. Cash buyers, flippers, and landlords who can close quickly are your ideal targets. Build your list by attending local real estate investment meetups, joining investor Facebook groups, and networking with agents who work with investors.

When marketing the deal, focus on the numbers: purchase price, ARV, estimated repairs, and potential profit. Serious investors make decisions based on data, not emotions.

Step 5: Closing the Deal

Once you have a buyer, you'll create an assignment agreement that transfers your contractual rights to them. They pay you the assignment fee at closing, and the title company handles the rest. Your fee typically ranges from $5,000 to $20,000+ depending on the deal size and spread.