Selling to home buyers

Bird Dogs, Wholesaling
1

I am brand spanking new to wholeselling. In fact, I just started marketing two days ago. I started with building my buyers list first so I don’t have any sellers yet. The good news is I got 10 leads in the last two days and one of those leads is pretty solid; a real estate investment group that wants to buy single family homes from me at the rate of 1 every three months as long as the numbers work out. The other lead that got my attention seems a little less like the standard wholesale buyer.

A lady contacted me saying she wants to buy a home for herself to live in. She does not have a line of credit but said she has cash now to use as a down payment. She explained that her credit is not all that great and told me she thought she should most likely get pre-approved for a home loan.

Should I try to sell this woman a house (after I find one lol) or recommend her to a realtor? I have thought about recommending she get pre-approved for a home loan so I could show her some deals and close on one (whenever I actually get one), but I get the feeling that a realtor would end up snatching this buyer out of my hands.

The other thing that occured to me was a lease w/ option to buy if she cannot get approved for a home loan, but don’t I need to be able to buy the house myself in order to do this? I have limited funds and do not want to start out leveraging what wealth I have to buy a house myself.

Any suggestions??

2

I suggest you familarize yourself with the Dodd/Frank Act and SAFE …BEFORE… you start to sell anything to someone to occupy as their residence.

3

Bill H, I have read those and understand the implications. Thank you for the suggested reading. Doing business in the U.S. is becoming a pain.

Now, does anyone have any suggestions on HOW TO DO A DEAL in this sceanrio?

4

This deal is not a problem. Here are a couple of options:

Wholesale. Find out what type of house she is looking for and what she can afford. Might be a good idea to advise her to get pre-approved for a loan (though she might get owner financing). Get a property under contract subject to your “partner’s” approval. Then either transfer the contract for a fee or do a double close.

Lease Option: With this scenario, you locate a homeowner who wants to sell the property either on a Land Contract, Subject To or on a lease option. In exchange for finding his buyer, you charge an option fee paid by the buyer. You do not need to buy the house. You are not handling the loan. You could even get a real estate attorney or possibly even a title company to write up the contract. You simply bring the two parties together for a fee.

5

Austin,

I’ve been at this since Moses and I shot spit-wads at a Pharaoh.

Forget trying to find a house to fit this woman.

You’ll grind yourself to tears. Really.

Buyers ARE a dime a dozen.

You didn’t even have a property, and all of the sudden you’ve got a wad load of potential buyers. See how easy it is to find buyers?

But you’re getting the cart before the horse doing that.

In fact, you’ll find six houses that fit that first woman’s criteria, and she won’t close on any of them. Or every time you find a match, the criteria will change.

In the meantime, you’ll have found buyers for all six of those houses you showed her in the first place. pffft’

The deals come first. The deals come first. The deals comes first.

========================
We seller finance routinely as a major part of our investing.

Sellers with no equity, and desperate, call us on our advertising, and we offer to take over their payments, and save their credit, in return for their deeds.

Once we’ve got the deed, we sell non-qualifying financing with the house, to buyers who want pretty, turn-key deals. We ask for 10% down, and let any of those buyers with the down payment we want, take over the payments.

We just closed and flipped a beautiful $550K house, and put $45k in our pockets, after we paid the seller $5k to move out. We had the thing sold, before we actually recorded our deed.

How’s that possible, you ask. Because the right deal, attracts a dozen buyers, and not the other way around.