As I am new to this I have chosen to Wholesale to build cash first. However, I am finding it very difficult to find a solid step by step formula to follow that will guide me all the way through the double close. My personal situation at this time requires no financial outlay, credit is shot and we just had a son last month.
Does anyone who has flipped a house using a double close have a step by step formula I can use to guide me through the first flip or 2. I understand the concept but I have never even done a regular close let alone a double close. I guess I am allowing the fundamentals to boggle my mind.
Jengar - I am not an expert and I never did a double close. I am more interested in buying and holding. I started participating in this forum few weeks ago and I got a lot of very good information here. My suggestio to you is to go back and read as many threads as you can. At first you may feel a little bit lost or even overwhelmed. But if you keep reading things will start to make sense to you and before you know it you will learn the basics.
One suggestion that I read several times here is that you should join your local Real Estate Investment association. There you will find people that are doing the same thing you want to do. It is usually very unexpensive. I am going to my first meeting this Monday.
Based on what I learned here the concept of wholesaling is very simple:
1 - you find a buyer(s)
2 - ask what they are looking for - what types of properties, area, condition - are they willing to renovate, or they want something that is already in good condition. What is the price range. What is the discount to market value that they are looking for. Etc… Etc…
3 - then you find a house that fits his criteria and put it under contract.
4 - you present the opportunity to the buyer.
5 - you close the deal and get your money.
For each step there are a ton of information that you will need to find - for example, what are some of the ways you can use to find a buyer… How you go about finding properties… How you put a property under contract… etc… etc… You will find a lot of the answers in this forum (and probably other forums).
This is a very basic outline of the steps to wholesaling a home. The above description hit it right on, but here is my two cents.
1st Build a buyer’s list-A strong buyers list will one of the most important aspects of your success as a real estate wholesaler. Be sure to build your buyers list before tying up any home under contract.
2nd Find Homes that meet your buyers needs- Once you have your buyers list in place it is time to start looking for great deals on homes that fit your buyers criteria.
3rd Put the home under contract with an easy out clause- Once you have located a home that meets the criteria for your buyers, you will need to put the home under contract. Include an easy out clause in the contract in case your buyers decide that they do not like the home.
4th Get your buyers through the home- Bring all of your buyers through the home to see if it meets their needs.
5th Assign the contract to you buyers or sell them the home-If the home meets their needs then you will need to establish a price that you are willing to sell them the contract for, or a price that you are willing to sell them the home for. If you are unable to assign the home then you could use a back-back closing instead. If do put the home under contract with your buyer’s then be sure to get a deposit from your buyers that is at least equal to the amount that you could lose if your buyers decide to back out of the deal.
6th Use your easy out clause- If your buyers do not like the home for one reason or another use your easy out escape clause to terminate the contract. The process ends here if your buyers do not like the home.
7th Set up a closing and get paid-If you are assigning the contract you may have already sold your position to your buyer, in this case you may have gotten paid already. If you did not get paid for selling your position already then you will be waiting for your buyer to set up a closing, and at the closing you will be collecting your fee.
Keep in mind that every person who currently wholesales homes started out not knowing a thing about the business.
The forums are a great place to learn, but be sure your learning from people who “do” wholesaling, rather than people who “read about” wholesaling.
Jengar, I’m a beginner as well and I’ve found Steve Cook’s Wholesaling course extremely helpful in setting up the guidelines for wholesaling. It’s very cheap compared to the other courses out there as well.