Wholesaling Fire-Damaged Houses in Texas

The short answer

Can you wholesale a fire-damaged house in Texas?

Yes. Burned houses sell as-is all the time. The key is agreeing up front who keeps the insurance money.

The house and the insurance claim are two separate assets. An owner can sell the property and keep the claim, or assign part of the claim to the buyer, but the purchase contract must say which. If there is a mortgage, the lender is usually named on the insurance check and will want its loan paid, which affects how much room there is for your fee.

The opportunity

Why fire-damaged houses are wholesale deals

Most buyers cannot get a traditional loan on a house with fire damage, and most owners do not want to manage a rebuild. That leaves cash investors and builders. In fast-growing Texas cities, even a total loss can be worth good money as a lot, which gives you two very different buyer groups for the same lead.

Lead sources

How to find fire-damaged houses in Texas

• Local news and fire department reports. Many fire departments post incident summaries. Note the address and follow up weeks later, not the next day.
• Code enforcement. Cities issue orders to secure burned buildings. These records point to owners still deciding what to do.
• Driving for dollars. Boarded windows, smoke marks and tarped roofs are easy to spot. Our driving for dollars guide helps you track them.
• Public adjusters and restoration companies. They meet owners who would rather sell. A referral relationship can bring steady leads.
• Our fire-damage guide. See fire-damaged houses for national strategies you can adapt to Texas.

Your exit

Two buyers, two pitches

For rehabbers, give the scope of damage, structural notes and whether the electrical and roof framing survived. Photos of every room matter more than ever, along with any insurance adjuster’s estimate the owner will share.

For builders, lead with the lot: size, zoning, utilities and what new homes nearby sell for. If the house will be demolished, buyers need to know whether the city has already issued an order and what demolition will cost.

Step by step

How to start wholesaling fire-damaged houses in Texas

1. Wait a little. Reach out after the first weeks, once the owner has met the insurer and knows their options.
2. Ask about the claim. Find out what has been paid, what is pending and whether a mortgage exists.
3. Agree on the insurance money. Write into the contract whether the owner keeps the claim or assigns any part of it.
4. Inspect safely. Walk the house only with permission and proper footwear. Check for structural damage.
5. Price two ways. Value it as a rehab with the fix and flip calculator and as a lot using nearby land sales.
6. Sign and disclose. Use a purchase contract and give the written assignment disclosure.
7. Close through title. Title coordinates with the lender and any claim proceeds the contract assigns.

A kitchen fire gutted half of a 1950s house in an Austin neighborhood where new homes sell well. The owner’s insurer paid for her temporary housing and personal property, and the lender was named on the dwelling check. She did not want to manage a rebuild and asked whether she could sell the house and keep her insurance claim.

You agreed in writing that she would keep the full claim. Then you priced the property two ways: as a rehab, which required about $165,000 of work, and as a lot, which builders in the area were paying about $120,000 for. The lot was the stronger exit. You signed at $98,000 with the written assignment disclosure.

A local builder paid $112,000 for the assignment, planning to demolish and build new. Title confirmed there were no city liens and that no demolition order was pending. The owner kept her insurance proceeds and her sale proceeds, which together gave her far more than a rebuild would have left after months of stress.

Texas rules to know

Insurance and the city come first

Texas insurers must follow prompt-payment deadlines under Chapter 542 of the Insurance Code once a claim is filed. Owners often expect a quick check, but the lender named on it usually controls repair funds. Do not promise an owner a number until you know what the lender will release.

Cities can declare a burned house a dangerous structure and order it secured or demolished, sometimes with fees that become liens. Ask for any city letters and check for liens with title, so your buyer knows the true cost.

Learn it with a mentor

Price your first burned house with us

Fire deals are easy to overpay for. Mentorship students review the scope and the insurance situation with a mentor first.

FAQ

Fire-Damaged Houses in Texas: common questions

Keep going

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