I See these all over the place. who puts them up? rehabbers? and when I say rehab, I mean someone who is going to do what I thought I knew to be “flipping” where you buy a house that is run down, fix it up and sell it for a profit like you see on these bogus tv shows.
so what’s the deal?
Investors put those signs up. Usually they will do a mixture of deals ranging from landlording, to rehabbing. Some don’t specialize in all cash deals. These types are usually looking for lease option deals, seller financing, taking over payments subject 2 the existing financing.
When I go see houses I am always writing down the # on bandit signs. It is a great way to build your buyers list and to screen the competition. Most of these people do not even answer or return calls…lol But you will find a few good people out there. I call and if I get them on the phone I ask if they are buying houses or flipping them. I just found a cash buyer in Newark, NJ from calling these signs.
But yes anyone from Birddogs,wholesalers, rehabbers, and landlords put these up.
Your local investors - you, me whoever
I got a call Tuesday from a wholesaler who saw one of my “I buy homes for Cash” signs.
Be careful dealing with other wholesalers. Make sure they know what they are doing. If you find one that does, youre in good shape. If they dont , you’ll end up in daisy chains on deals that will not move.
Example -
—Wholesaler Alex the Aggressive gets a property under contract for 30k and he should have had it for 20k to be a deal.
--- Wholesaler Bill the Beginner gets a call from Alex and Bill wants in on the action so he says yea I can move it. Bill has 2 buyers and they arent qualified, but he puts another 5k on the contract.
--- Bob the Buyer, who is Bills contact actually isnt a buyer but says he is. He says he'll buy it, but he turns around and shops it to couple of his buyers for 40k. To say the least, the deal dies.
By the end you have a deal that should have been at 20k now at 40k and a bunch of wholesalers not making money let alone an angry homeowner. We are very diligent in checking with the wholesalers we work with and we require 5k down to take any of our contracts. We bumped into a deal once that we tracked down 7 wholesalers trying to squeeze a 10k spread. We were able to nip it in the butt because one of my big buyers was the actual owner and called me to ask if I knew why his house was being pushed around. I told him because he has 7 wholesalers that dont know what they are doing trying to make a deal.
I would steer clear of working with other wholesalers. They’ll burn your deal and email it all over town at different prices and then it will make it more difficult for you to sell. Find your own deals and find your own buyers. If you must work w/ another wholesaler do a jv deal.
those who want to buy houses!! too obvious…just joking LOL
Investors, rehabber and Wholesaler
thanks for the info. so should I be looking to build a buyer list prior to advertising to distressed buyers?
It depends. Many of the gurus say build your buyers list first. Others just find a great deal and can easily find buyers because they are great marketers to begin with. There is no reason why you should not be making offers and marketing for motivated sellers and working on your buyers list at the same time.