How often is it for you to come across some good wholesale deals only to find out the seller wants all cash? Most times you could get the property under contract with a purchase agreement then assign to end buyer with no money out of your pocket. That is how I prefer to get properties. Unfortunately, that is not always the case. I can tell from the situation I am in right now. I have someone selling wholesale properties, but the seller wants cash only with no contracts allowed to purchase the deals. I surely don’t have cash of my own to buy the properties. This puts me in a bind seeing the only way to get the homes is with cash.
How do you overcome this situation where the seller wants cash money upfront to get the home and you know you don’t have a dime of the money out of pocket to get the home all because you thought you could get it under contract?
You know there are 500,000 homes for sale at any single time of year and roughly 6,500,000 sold every year of which real estate investors participate in 1,600,000 roughly deals.
Why can’t I buy “General Electric”? Why Can’t I buy “Bank of America”? Why Can’t I buy “Ford Motor Company”?
Well it’s not for lack of brains, lack of experience or lack of education but it’s for lack of one basic thing, enough cash to have skin in the game! I actually could buy any of these companies (Corporations) at any moment if I have enough cash to convince investment banking firms we have a viable plan and a reasonable amount of our own cash!
So why don’t I make an offer to buy tomorrow? I am lacking the 10,000,000,000 or so dollars I would need to have skin in the game, and so why do I pass on these deals, well it’s lack of cash so I pass by these companies even though GE may be worth more broken up and sold as pieces but without cash to have skin in the game I am not buying any of these companies tomorrow!
So all cash deals through a wholesaler are either handled by using hard money and cash down or there not purchased at all, it is impossible to buy every property you see, plain and simple it’s impossible!
How do you overcome it, you find properties to assign, you find properties to lease option, you find properties to subject too, you find properties to double close on, you find anything you can to make money!!!
I was actually considering doing subject to investing. From what I hear the money to be made in this investment is awesome. But like always the naysayers kept warning me it’s a bad idea to do subject to because of the risks involved. It’s not just that either. I don’t know where to get the required paper work to start the sub2 procedure. If I had the paperwork, I would be doing something right now. I never done lease options before, so I am lost on that one.