Is the reo Wholesale formula the same in 2015 ? arv x .65-repair-fee=max offer

Bird Dogs, Wholesaling
1

hello

1.) Is the reo Wholesale formula the same in 2015 ? arv x .65-repair-fee=max offer

2.) do you use the same for junkers ? as you would for a pretty house already rehabbed ?

2

Hi,

I have usually used a .70 multiplier for a pristine condition updated modern home with no deferred maintenance.

I adjust this according to market conditions. IE- A really bad / poor area might only justify a 60 or 65 multiplier where in a fast moving great market like Las Vegas in 2004 and 2005 where we were buying at 90 or 95% and flipping the contract for a $10k or $20k margin in a few days to a retail buyer!

       GR
3

that’s sounds great but i am in s.Cali (inland empire/riverside) i am a wholesaler so i would have to flip to my buyer…looking at homes at $200-250K reos with no repairs…what should i offer to the bank so i can sell to my buyer ? and some fast cash

4

Hey American dream, It will be interesting if you can wholesale REO’s I think ur going to have to deal with Realtors and banks, large earnest deposits and proof of funds etc.
I target fixers that are FSBO’s (For Sale By Owners)
I’m after the worst junkers in the neighborhood.
I start at 50% of After Repair Value and depending on the condition I will go down to 30% or up to 60%
If there are lower income areas near Riverside you can target those.
But for a beginning Wholesaler to wholesale REO’s in the higher end markets cud be a challenge.
Keep us updated.

5

Hi,

I do 70% of "As-Is" value!

Then minus any repairs, remodeling and construction costs minus overhead minus carrying costs minus escrow and realtor costs!

If value is market because the home is in pristine condition so be it but homes in poor condition should be valued accordingly!

        GR