BiggerPockets

I think I saw a post on this before, but can't find it now. My thought is this...

I'm looking to invest in smaller towns all within driving distance from my town. Can I pay realtors in these towns with a 1099 to bird dog vacant houses they find while doing their work? Or any other types of properties that may work for me as an investor, but they will not be listing for whatever reason?

I did a Google search today for we buy houses in several of the towns, and only statewide and national companies showed up, on search results as well as ads.

Could this be my niche?

Your thoughts appreciated.

If the payment is performance based then made directly to the agent it may be a DRE violation. I know it is in my state.

You can however enter into either a partnership or make them an officer of a Corp.

Although very easy to set up it would be best for you to have an attorney walk you through the paperwork. BTW the violation isn't on your side of the exchange.

The added issue is answering for the agent this question. Why as an agent wouldn't I just take a listing then sell it?

Part of the secret to succeeding in the acquisition, wholesaling or flipping of homes is becoming an expert buyer of these properties. As you add brokers and finders, your profits begin to erode. People who are in the business of brokering properties wouldn't likely work for the low price that a bird dog is typically paid but it doesn't hurt to ask.

I like Michael's concept of mailing to owners of properties, or you can have someone working on your side. But it is hard to imagine that it will be a licensed real estate professional.

So what I hear you saying is: There are agents that are unfamiliar with how to do their job, and you want to work with them? Is that correct?

as a realtor........... I bird dog. I take the commission on the purchase side... Prices here in Cali make that... OK! for gas and golf money :-) .... Then i negotiate the listing on the back end.... if they wholesale... then i have my own buyers list as well and get a piece of that.

The KEY THOUGH : Find a realtor who understands how investors think and are willing to fire the offers out.Most Realtors treat investors like buyers.... then to them it's too much work. Me ! i like the trenches and it has been a wealth of knowledge gained... as i will begin to do my own deals next year..... have connected with a host of private money sources over the past 2 yrs.

@juan. On the flipside, an agent like you would be a GREAT plan if you wsnted to do the leg work, and not take the deal for yourself for whatever reason. Come to TX :-)

I KNOW there investor-savvy realtors. I'm sure I will work with many of them. I'm also looking to innovate and make a little extra mobey for me and others as well. Once I get a couple local deals dobr, I'll start having these conversations and keep NO updated on how it goes.

More thoughts welcome. :-)

Look at it this way Shane............ Commission is FREE MONEY.... The seller and or REO Bank pays that.... So give the Freebie to the agent.You get the property.... If the agent is like me... they are going to do 90% of your Due Diligence anyway... after a while, they will get to know EXACTLY what YOUR formula is.... Then when it comes to you... your work is done.... just verify pretty much. Save your cash.... Now if you choose to get into wholesaling..... let the agent do the contract... take commish.... you wholesale.... take the fee.... and you make a few K for just filling out paperwork..... how cool is that ? Now the agent is motivated to find quick deals along with their normal clients..... these deals are usually 15 days or less...no lender hassles. And if the agent is good.... let them sell it on a sliding scale.... something like this( 5%...with 3% to the buyer side.... or 4% if they bring the buyer )..... Just a thought. My uncle once said " Never take all the money off the table... when everybody eats well...it breeds LOYALTY. Stinginess breeds envy and distrust.... Good Luck to you

I disagree. The investor does not pay out of pocket.... yeah maybe he can.. negotiate a few k off the price.... but is it really worth it. OK !! FREE TO THE INVESTOR'S front end cost.... Realtor does need to earn it..... I hope I cleared that up

The buyer absolutely pays the commission. As it is included in the price of the property and value in appraisals.

I'm not saying the right agent isn't worth the payment however ultimately it is being paid from buyer proceeds.