I have wholesaled many deals but am a bit fearful these days. All of my wholesale deals previously were prior to the market slowdown and I had never had trouble getting a buyer. Now with the slowdown I am becoming more fearful that I will not be able to promise a quick close to my sellers because of the downturn in the market. Thoughts?
market for new buyers if the ones you currently have don’t wanna buy.
Fear is a funny thing! It doesn’t sound like you’ve had a problem selling your deals in the past. If anything you could buy at lower margins than you used to so your deals are even better now.
There are always deals, there are always sellers and there are always buyers.
If the deal is good enough, someone will buy it in any market condition… :biggrin
As long as you have your “easy out” clause in the contracts, then fear should go away. Remember what FEAR is:
The Best Deals, can always find money and buyers
Dumb question…what’s the easy out clause?
Ya, I think someone metioned on another post we really should be perpared to close on these deals if we don’t find a buyer. If we continually write contracts and weezel out it will catch up to us.
Steve Cook in his articles on this site talks about putting either a financing contingency in the contract or being up front with the Seller.
I don’t do the financing contingency b/c I don’t want to spend the $300 - $1000 to a hard money lender for appraisal/processing.
I do put an inspection clause or pay option money for an inspection period. I’m very up front with the Seller. The inspection period gives me time to get contractors, inspectors, and/or partners (e.g., other investors) into the property. If need be, I would go back to the Seller to amend the contract to reflect the repair costs. But that does not mean that I won’t buy the house.
If the Seller doesn’t budge on reducing the price, then maybe instead of a $10K profit or whatever, I could assign it for a $3K profit, or even $500. I’d try that 1st, since the property would still get sold. Then if that doesn’t work, I can exercise the clause in the contract to terminate it. Or the worst case scenario, I lose the earnest money - which shouldn’t be much when dealing with a motivated seller.