Wholesaling REOs

I plan to target REO properties to wholesale and I was reading some information on ways to get out of the contract if need be. One way that was stated is through the inspection period. The “guru” stated that if the real estate agent (which leads to another question, how do I know which agents have access to REOs) is 99.9% sure the bank will accept your offer they will send you addendums (which override the contract) stating the inspection period is 7-10 days. What I don’t understand is how this helps you to get out of the deal. If they give you an inspection period I thought it was the buyers responsibility to comply, if not buyer (being me, well wholesaler) is SOL. I’m a little confused. Can someone please clarify!!! Thanks

Any agent should have access to REOs if they are listed on an MLS. I would suggest finding an agent that is investor-friendly and develop a good relationship. If you’re making them money they will make sure they keep you in mind when new properties come up. If you are looking for REOs that are not listed on MLS then you may have trouble finding an agent willing to help you.

As far as as the inspection period, YOU (not the investor you are wholesaling it to) will have 10 days (or whatever you agree to) to back out. The investor you are turning it over to is not going to have an inspection period. They will inspect the property themselves before they offer to buy it. Once they decide to buy it you assign it to them before closing.

If you are asking what happens if you do not find somebody to wholesale the property to before your 10 days are up, I’m not sure of any other ways that are going to save you from losing your earnest money. You could always back out on day 10 if you don’t find a buyer, or take the risk if you’re pretty confident you can.