Introduction
You’ve locked up a great wholesale deal. Your end buyer has signed, the title’s being processed, and you’re days—or weeks—away from closing.
So now comes the question: Do you wait to get paid at closing, or use an assignment fee advance to access funds now?
While both options are valid, the right one depends on your cash flow, volume, and growth goals. This article breaks down the advantages and trade-offs of each approach, so you can choose the best strategy for your wholesaling business.
Option 1: Traditional Assignment Fee at Closing
The standard approach is simple:
You assign your contract to the buyer and wait until closing day to get your full fee.
✅ Pros
- No deductions or costs. You get 100% of your fee.
- Clean accounting. Everything is handled in one closing statement.
- No early paperwork. No extra agreements or funder documents needed.
❌ Cons
- Cash flow delay. Waiting 2–4 weeks (or longer) can limit your ability to lock up new deals.
- Increased risk. If the buyer backs out late, you lose time—and possibly money.
- All-or-nothing model. You can’t reinvest any of your profit until the deal is done.
📌 According to BiggerPockets, one of the biggest challenges wholesalers face is managing the timing gap between securing a deal and getting paid.
Option 2: Assignment Fee Advance (Secured by EMD)
In this model, a funder gives you an upfront portion of your fee, secured by the end buyer’s Earnest Money Deposit (EMD). You receive your advance before closing, and the funder is repaid—plus a fee—first at the closing table.
✅ Pros
- Faster cash access. Typically within 24–48 hours of EMD deposit.
- Scales your business. Reinvest in marketing or acquisitions immediately.
- Low risk. If the buyer fails to close, the funder recovers from the EMD—not from you.
- Non-recourse structure. You owe nothing if the deal falls apart and the EMD covers the advance.
❌ Cons
- Fee deducted at closing. You’ll net less than 100% of your assignment fee.
- Documentation required. You must assign refund rights and show contract/EMD proof.
- Not for every deal. If the EMD is small or delayed, an advance might not be feasible.
📌 FortuneBuilders highlights that effective wholesalers focus on deal velocity, not just deal size. Assignment fee advances help accelerate that velocity.
When to Use an Advance vs. Wait for Closing
| Scenario | Best Option |
|---|---|
| Tight on marketing budget | Advance |
| Buyer has high, non-refundable EMD | Advance |
| First deal with an unknown buyer | Wait for closing |
| Fee is small and closing is next week | Wait for closing |
| Scaling and need multiple contracts open | Advance |
| Want maximum payout with no deductions | Wait for closing |
📌 The Close suggests wholesalers track both their gross assignment fees and net cash flow timing. Early access to capital can mean the difference between stagnation and growth.
Final Thoughts: Pick the Strategy That Matches Your Momentum
There’s no one-size-fits-all answer.
If your business is cash-rich, waiting for closing may be fine. But if your pipeline is solid and cash flow is tight, assignment fee advances—secured by EMD—can unlock the capital you need to keep growing.
🚀 Have a deal under contract with EMD in escrow? Get paid early with a protected assignment fee advance.
👉 [Apply for an Assignment Fee Advance ]