A disciplined framework for evaluating wholesale deals (that removes emotion)

I see a common pattern in wholesaling.

New investors focus on finding deals.
Experienced investors focus on killing bad ones.

The difference isn’t hustle.
It’s underwriting discipline.

Over time, I stopped asking, “Can I make this deal work?”
And started asking, “Does this deal survive conservative math?”

Here’s the framework we use internally.

Step 1: Define ARV Properly

ARV is not:

• The highest comp in the zip code
• The listing down the street
• A Zillow guess

We use 3 recent sold comps within 0.5–1 mile (when possible), similar bed/bath, similar sq ft, similar condition post-renovation.

Average them.

If you have to stretch to justify ARV, that’s already a warning sign.

Step 2: Estimate Repairs Conservatively

Most new wholesalers underwrite repairs emotionally.

We use a simple sq ft tier system:

Light rehab (cosmetic)
Average rehab (cosmetic + systems)
Heavy rehab (full renovation / structural)

Pick one tier. Don’t blur them.

If there’s uncertainty (no access, visible foundation cracks, long vacancy), add a buffer.

The goal isn’t to be perfect.

It’s to avoid embarrassing your numbers in front of buyers.

Step 3: The 70% Rule (With Fee Included)

The formula:

ARV × 70%
− Repairs
− Assignment Fee
= Maximum Allowable Offer (MAO)

Two common mistakes:

1. People forget to include their assignment fee in the formula.
2. People treat 70% like a suggestion.

If the seller’s number is above MAO, you either negotiate or walk.

Hope is not a strategy.

Step 4: Control Before Marketing

I see this constantly:

Deal blasted before escrow is open.
Deal blasted before contract is confirmed assignable.
Deal blasted without seller clarity.

That’s how reputations get damaged.

Basic control checklist:

• Signed contract
• Assignable clause (or double-close plan)
• Escrow opened
• Inspection window active

No control = no marketing.

Step 5: Buyer Discipline

Serious buyers:

• Provide proof of funds
• Deposit meaningful EMD
• Close without drama

If a buyer won’t send proof of funds, they’re not a buyer.

If they want to “walk it with their partner first” but won’t show liquidity, that’s a red flag.

Most fallout doesn’t happen because of math.

It happens because of weak buyer vetting.

Step 6: Kill Fast

The biggest shift in my business wasn’t finding better deals.

It was killing bad ones faster.

If:

• There’s no equity
• Seller is retail-minded
• Title is messy and unfixable
• The spread is thin
• Risk flags stack up

Walk.

Time is your real inventory.

Final Thought

Wholesaling isn’t about being persuasive.

It’s about being precise.

When you define rules and enforce them consistently, decision fatigue disappears.

You stop negotiating with yourself.

Curious how others here structure their underwriting.
Do you use hard MAO caps?
Or is it still more deal-by-deal discretion?