← Wholesale Real Estate VA / ISA Training Lesson 3 of 8 · ~13 min

Deal Vocabulary: ARV, MAO, LAMPS and the Words That Get You Hired

The vocabulary is the job interview

Wholesaling English is its own dialect. An employer can tell inside two minutes whether you speak it. This lesson is your working glossary. Do not memorize it as trivia. Use each word in real sentences until it comes out without thinking.

Remember your seat. As the ISA you are the qualifier, not the closer. You gather the facts, score the motivation, and hand a clean lead to the person who makes the offer. You will not quote a price or negotiate terms on a live call. But if you cannot speak this language, the closer cannot trust your notes and the seller will not trust you. So learn the words cold.

The deal-math words

70%of ARV is the rough ceiling before costs

+10%added to every repair estimate, always

$10Kminimum assignment fee we aim for

ARV — After Repair Value. What the house sells for once it is fully fixed up. It is priced off the North Star comp: the nicest remodeled house that recently sold in the same area. Every offer starts from ARV.

Repairs. What it costs to get the house to that ARV. The closer estimates it from your photos and video walkthrough. Two things to know about how the closer builds it: a 10% buffer always gets added, and the final figure lands on an odd number — "$27,450" reads researched, "$30,000" reads guessed. You never say either number to a seller. You are learning how the estimate is built so your notes feed it properly.

Spread. The gap between the price we lock the house at and what it is worth to a cash buyer. Our entire paycheck lives in the spread. No spread, no deal.

MAO — Maximum Allowable Offer. The most the operation can pay and still make money. The closer runs this, not you — but you should understand it, because your condition notes are what feed it. Two formulas, and the lower of the two is the ceiling:

70% rule: (ARV × 0.70) − repairs − fee.
Merrill: ARV − 20% of ARV − repairs − fee.
The lower number is the ceiling, and the opening offer sits 10–15% below it. Again: this math happens after your call, never on it.

MAO worked live — $300K house, $40K of work

ARV $300,000 (North Star comp, remodeled)

Repairs $40,000 (cosmetic, +10% already in)

Target fee $15,000

70% rule 300,000 × 0.70 = 210,000 − 40,000 − 15,000 = $155,000

Merrill 300,000 − 60,000 − 40,000 − 15,000 = $185,000

Ceiling the lower one: $155,000 — open around $135,000

EMD — Earnest Money Deposit. The small good-faith deposit, usually $500–$2,000, we put down when the contract is signed. It shows the seller we are real. It is not the purchase price.

The exit words — how a contract becomes a check

The moment a seller signs, the operation owns a contract: a signed right to buy that house at a set price. That paper is the asset. Here is the one idea the whole business turns on.

Key idea: You sell the contract, not the house. An assignment is like selling a hard-to-get dinner reservation. You booked the table at a great price. Someone wants it more than you want the meal, so you hand them the reservation and they pay you for it. You never sat down. You never paid for dinner. You got paid for booking well.

Assignment. Selling that purchase contract to a cash buyer for a fee. The buyer closes directly with the seller at the contract price, and the operation collects the assignment fee at closing. Nothing down beyond the EMD. This is the bread and butter.

Double close. When the fee is too big to sit comfortably on one settlement statement, or the contract bans assignment (bank-owned deals often do), the operation actually buys the house and resells it the same day. Two closings, back to back. The seller and the end buyer never see each other's number.

Wholetail. When the house is too nice to hand a gut-rehabber cheap but too dated to sell as-is, the operation buys it, does a light cleanup — paint, carpet, haul-out, no permits and no new kitchen — and lists it on the MLS near retail. The middle path between wholesale and flip.

"And/or assigns." The three words we sign the contract with — "[Company], and/or assigns" — that give us the right to bring in a buyer to close in our place.

Reality check: The assignment fee is disclosed. It shows on the settlement statement, and we tell the seller upfront that we may assign. We never hide it, never invent a fake buyer, and never fabricate urgency. Honesty is the business model, not a nice-to-have.

The people words

1–2motivated sellers per 10 real conversations

~6.6%2026 mortgage rate — why a low-rate loan is a prize

Motivated seller. Not just anyone who might sell. A real one has all four: they want it gone (a timeline), they have a real reason (motivation), there is friction (bad condition or a hard situation), and their price expectation is not delusional. Expect one or two motivated sellers per ten real conversations. Everyone else is a follow-up asset, not trash.

Cash buyer. An investor who closes without a bank loan. This is who the operation sells the contract to. Fast, with no financing to fall through.

Buy box. A buyer's exact shopping list: areas, property types, price band, max repairs. "3/2 single-family in ZIP 55407, under $250k, cosmetic only" is a buy box. Match a deal to a buy box and it sells itself.

Distressed lists. Where leads come from, each type a different temperature: absentee owners and tired landlords (the easiest conversation, high equity), pre-foreclosure (real urgency, handled carefully), probate and inherited (motivated, low attachment — mail first, never cold-call the recently bereaved), divorce, tax-delinquent, vacant, and code-violation owners, and expired listings. Every number is scrubbed against the Do-Not-Call list before you ever dial.

The qualifying words — LAMPS

This is your job in one word. On every call you fill in five blanks, remembered as LAMPS, and hand them to the closer.

LAMPS — the five blanks you fill on every call

L — Location Where is the property? Is it in our buy area?

A — Asking price What number do they have in mind, if any?

M — Motivation WHY are they selling? The question that matters most.

P — Property condition Repairs, tenants, who lives there.

S — Situation / timeline How fast do they need this done?

Reality check: A seller with a great price but no motivation is not a lead. A seller with no price but real motivation is. When you score a lead, weigh M and S double. Motivation and timeline are what turn a house into a deal.

Price or terms — the words above your pay grade

Sometimes a seller says "I need my full asking price, I won't budge." A rookie hears a dead deal. A trained ear hears a clue. There is one rule the closer lives by:

Price or terms — not both. A seller can have their full price, or they can have a fast cash lump sum, but not both. If they insist on top price, the closer may pay it in exchange for terms: getting paid over time instead of all at once.

Two words to recognize when that happens:

Subject-to (Sub2). The operation takes over the seller's existing mortgage payments and leaves the loan in place. Gold when the loan has a low rate — a 3% loan in a 6.6% world is a prize worth keeping alive.
Seller finance. The seller becomes the bank. They get their price plus a monthly check with interest, instead of one lump sum.

Reality check: You never quote or negotiate terms — that is the closer's seat, and in some cases the owner's alone. Your job is to catch the signal. When a price-stuck seller still has real motivation, do not kill the lead. Tag it "price-stuck, possible terms," note the loan and whether the house is paid off, and hand it up. That one catch can save a deal a cash offer would have lost.

Practice tool: Run this lesson's numbers in the MAO Calculator and the Max Offer Worksheet — the drill below expects you to have both open.

Quick check

Answer before you move on. Instant feedback, no score kept — this is practice, not the exam.

1. ARV is $300,000, repairs are $40,000, target fee is $15,000. Using the 70% rule, what is the MAO?

2. Why add roughly 10% on top of the repair estimate before running MAO?

3. In LAMPS, which two matter most when a lead looks borderline?

Drill

Pick a house — a real US listing on Zillow, or one you invent with sensible numbers. Produce two artifacts and keep both.

Write a five-line LAMPS log, one line each for Location, Asking price, Motivation, Property condition, and Situation/timeline — in real sentences, the way you would type them for the closer right after a call.
Record yourself out loud, under 90 seconds: state the ARV, subtract repairs (remember the +10%), run both MAO formulas, name the lower number as the ceiling, and finish with the exit — "we assign the contract to a cash buyer for a $____ fee." Use at least eight terms from this lesson.

If you stall on a word or a number, run it again until it is clean. Save the log and the recording. This exact pair — a qualified LAMPS note plus a spoken deal walkthrough — is what a wholesale employer asks you to produce in a working interview.

How Americans say prices out loud

On a live call almost nobody says "two hundred fifteen thousand dollars." They shorten it, and if you have not heard it before it is genuinely hard to follow. Mishearing a price by a factor of a thousand is the single most expensive listening mistake on this desk, so learn these before your first shift.

What they say → what they mean

"two-fifteen" or "two fifteen" → $215,000. On a house, a two-part number is always thousands.

"one-eighty-five" → $185,000. Never $185 and never $1.85 million.

"two and a quarter" → $225,000. A quarter is 25, a half is 50, three-quarters is 75.

"a buck fifty" → $150,000. "A buck" is one hundred here, not one dollar.

"forty grand" or "forty K" → $40,000. Grand and K both mean thousand.

"two-fifty a month" → $250 a month. With a month attached it is dollars, not thousands — context decides.

"under water" → they owe more than the house is worth. Nothing to do with flooding.

The rule that keeps you safe: when a seller says a price, repeat it back in full before you write it down. "Just so I have it right — two fifteen, so two hundred fifteen thousand?" Sellers never mind. Guessing costs the deal.

Tip: use your ← → arrow keys.