Is this what I think it is?

investor looks around for poor condition or old houses and then tries to contact the owner of the house or place and get an option [this is the confusing part] to purchase it or an option to purchase thus allowing him to find a buyer for a specified time and then gets the buyer to get it and he gets a finder’s fee. It seems simple but I had spoken to this person… how do I get started in this as what was explained to me was quite simple but it is in fact not as I think. Is this wholesaling or another variation of flipping. What type of option contract do I need ? As I had found a house that might fit this description but not sure how to go about it.


Howdy Yudie:

As a birddog you just point out deals that may be of interest to a buyer. As an example I had a guy who used to work for the City trash service. He rode on the back of the truck and jotted down the address of a vacant house or FSBO and gave me a list. I paid him on several deals.

If you get an option or get it under a sales contract with contingencies (almost the same sometimes) then you are wholesaling. You should be able to get more per property for this service as you found the owner and negotiated a low price. As an example here too I had a foreclosure under contract that I wanted to buy and fix up and keep but could not get the funds fast enough so I sold (assigned) the contract for $3000.

Hope this helps explain the difference a bit.