Has anyone tried to do assignment of contracts over the internet? From what I have heard/read, you can tie up a property with a contract (which you can also do when investing out of state) and then auction it off either on eBay or use Craigslist to find investor/buyers who want to pay you the assignment fee to buy the contract. It seems like a pretty viable plan and also allows someone to look out of state instead of being limited to just investing within their local area.
Has anyone tried this or know anything about it? I sure would be interested in learning how this is done.
Well I don’t know from expierence myself but apparently some of the movers and shakers in RE investing can attest its getting done.
TC Bradley just released a course on exactly that topic: doing out of state deals pretty much sight unseen. OutOfStateDeals.com is where you’ll find out more about it and if its worth the investment.
Let us know how it turns out if you decide to proceed down that road.
I just made an offer that is 73% below ARV today. The Realtor on the other end thinks that the seller will agree to it. I’m just awaiting word. I’ll be sure to let you all know how things go.
If I were to wholesale a property on CL.com and an out-of-state investor wanted to tie up the property, I’d let them… in return for commensurate non-refundable earnest money and an iron-clad contract ;).
I have investor-partners in California doing rehabs with me in Ohio. I have pre-foreclosure deals in South Dakota, Mass, Florida and Nevada, to name a few. I have students I mentor in New York, Georgia, and elsewhere. It is certainly possible to play the real estate game out-of-state, site-unseen or whatever, but just make sure you do your homework.
What sort of “homework” is usually required when doing things sight-unseen? Besides getting comps and a general description of the condition of the place, including problems, is there any other information that I should be asking for?
Fundamentally, all the homework revolves around knowing that you have rock-solid comps. If you have that, then you can easily determine if it is a deal or not. Obviously, the amount of homework depends on the deal and the situation but here are some ideas off the top of my head:
check the census track of your subject property to see the demographics of the area; median income, ratio of owner-occ vs. investors, etc., can give you a clue
use free services or skip trace neighbors of the subject property and see if they will share information on the area you are investing in
use a realtor for help - for instance, if I locked up a property on a contract that has an escape hatch, I would not be shy in calling a local realtor (use an experienced agent, not a newbie), letting them know that I am an out-of-state investor who stumbled on a deal that I am considering listing. Let them run comps for you. Heck, newbie realtors do BPOs for $50 - $75 a pop, so hiring a realtor to do a “private BPO” for you is certainly affordable, if you had to resort to that.
Post and ask questions on REIclub.com and similar sites. You may be amazed at how many people will know the exact subdivision you are talking about
get a neighbor of the subject property or the tenant of the subject property (if it has one) to send you some digital pictures and send them $25 - $50 for their trouble. There are college kids that do drive-by property inspections for lenders for $25, and they do this as a real part-time job, so getting pics is easy.
if you need lawn work, hire a company to mow the grass and throw them an extra bone to send you pics of the streetscape, subject property, etc.
post to find bird-doggers in that area. They can help you evaluate the deal as well as find you a buyer if you need that.
obviously, you could easily hire an appraiser and/or home inspector to do a full report for you. For the right deal, it may be well worth it to spend the extra loot for this.
Again, if you have it locked up in a purchase contract with some decent escape clauses, then it is little threat to use any of the above techniques to get more info on the subject property.
When I make an offer for a property and all I want to pay is $100,000; do I just tell the seller $100,000 is my offer or do I also have to include other things like seller concessions, etc? Basically, I just want to pay $100,000 and not a penny more, so how would I explain that when I’m making an offer?
hey there, i’ve wholesaled to people i’ve never met by locating investors and agents online, however i haven’t used the web to actually sell it. we negotiated on the phone and used fax for signing the docs. get in touch with the local investor groups so that you can post on their site when you have a deal and call their president to find the right buyer.
If you don’t want to spend a penny more than $100k, don’t start at that number. Start lower. You can always go up but never down in an offer. So if your max you want to spend is $100k on a property, offer $89,900. That way if they counter-offer you have room to play and you can go up another $5k to $94,500. If they counter-offer again you’re still $5k under your cap so you still have room to negotiate. If you start at $100k and thats the MAX and they counter-offer you have nowhere else to go but exit stage left and go look for another deal.
The $100k is irrelevant anyways. You might come across a potential deal with $50k equity in it but its going to cost you $110k to get into it. You’ll disregard your $100k max offer real quick and jump all over that. You’ll find a way to come up with the extra $10k.