I want to start off by saying this looks like a great place to get more information and help from other investors. I can’t wait until I repay it.
I am working towards my 1st wholesale. My biggest problem was inaction and I’m past that now. I’m taking a lot of steps to get the ball rolling.
• Building My Buyers List by advertising for buyers, calling “We Buy Houses” signs and I’m going to start craigslist ads today
• Order Bandit signs to market for investors
• Once I get my taxes back, I am going to form an LLC to make offers with. I’ve read that with REO and HUD homes that the contracts aren’t usually assignable and the way to get around this is with transactional funding, double close, or assigning an LLC instead of the property itself
• Created a logo and business cards
• set up a professional email address @paramountacq.com
• Obtained MLS Access
I have a few questions for other wholesales that I was hoping to get some help with
How do you convince a Realtor to make offers on your behalf?
I want to be honest and upfront with them about what my end goal is which is a wholesale. I was going to show them my leg work that I have a network of cash buyers. I was also thinking about offering to pay a Realtor per offer, maybe $10 or so, just until I get my 1st deal, then once they see that I’m serious, they will go for straight commission. I will only ask them to get me into homes and necessarily show me homes and make offers. Since I have MLS access, I can pull my own comps.
My idea was putting an email list of Realtors who are NAID Registered Brokers together and sending out an email blast to see if I get any bites. I was also thinking about posting a craigslist ad. What’s everyone’s thought on finding a realtor to make offers for you?
How do you assign an LLC?
I’m guessing it varies from state to state but is just a transfer of ownership contract for $x amount?
Does anyone have a good referral for a transactional lender?
I think that’s it for now. Everyone’s input would be greatly appreciated.
The problem you are going to have by telling a Realtor what you will pay them to submit a offer for you. The Realtor have set fees to submit offers. Lets say a Realtor make a offer and it is accepted do you have the funds to closed the deal?
In your bullets points I don’t see any mention of a Marketing System. What types of home sellers are you going to target? Did you create a marketing campaign? A phone call follow up system? Online marketing? Etc.
I am a Realtor that does what you’re trying to get a Realtor to do. Except the investor I work with pays me 30% of his profits on the deal. It would not be worth my cut of a 3% (sometimes 2% or less) commission on a $50,000 property, even turning several a month, for all of the offers that are required to be sent. And if you’re paying him $10/offer, how many offers do you think it is going to take to get 1 deal closed? That’s going to add up quickly for you if y’all aren’t getting anything closed.
I’m not going to be marketing for sellers. My focus will be on HUD properties and REOs for my 1st few deals and then I might pursue private sellers, landlords, etc
The problem I have is that I don’t have a proof of funds letter or a track record to go to a realtor with. I could find a proof of funds letter online I’m sure but no track record If I could find a realtor who is willing to work with an investor and split the profits, it may be more benificial for me in the long wrong to have him just be paid his commission.
I was also considering find a real estate partner for my 1st few deals who can put up earnest money and proof of funds until I build up a track record and then split away from the partnership
I haven’t done this so forgive me if I’m missing something. But I’m curious why you’re not writing the offers yourself and submitting directly to the listing agent? They’d be more motivated to work with you since they won’t have to split the commission with a buyer’s agent. Couple your offer with your proof of funds of letter and they should be more than willing to work with you…
You can’t really wholesale HUD or REOs unless you do double closings. I purchased a HUD foreclosure last year and they track each bid and purchase a social security # and you can only buy one every two years. I saw a webinar that was selling ‘secret list of homes’ and all it was was the HUD list! They never mentioned that you can’t assign a contract on those properties. So if you want to to wholesale a HUD you need to close first and then do a completely different closing with your buyer. You would need transactional funding if you don’t have the funds for the first closing. Remember also that HUD forces you to use their closing agent and title company and they don’t do double closings. They also require table-funding so the money has to be there at the closing.
Similar with REOs - most banks will not allow assignable contracts. Again, they often require a certain attorney or title company for closing so it’s almost impossible to do a double closing.
Remember that HUD and REOs are listed on public websites so if they are really a good deal, they will be snapped up quick by cash investors. The best source of truly wholesable properties is direct from owners. Good Luck!