How I Botched My First Wholesaling Deal (& What You Can Learn From My 3 Mistakes)

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Everyone is different, but I have always thought that the best way to learn is by following through with actions. My firm belief is that failing at something and learning from it increases the learning curve of gaining a brand new skill. While you can read articles and purchase services from “gurus,” there will always be a certain point in time where you just have to move forward and take full control over your actions. In order to help you out, here is a story that helped me on my path to becoming a better investor. I sincerely hope it will give you something to learn from.

To give you a brief overview, this particular story is about one of my first ever attempts at acquiring a business deal as a real estate investor — and like all novices to the field, I made just about every single mistake you could possibly fall prey to.

Related: 10 Lethal Mistakes to Avoid on Your First Real Estate Investment

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My Deal Story (& the 3 Mistakes I Made)

To start the story off, the property lead came from a former colleague who knew I was a real estate investor. They mentioned that a particular seller (who they knew from childhood) was tired of managing their property from afar. This was a tip off that they were motivated to sell. So once I was able to get the contact information of this potential seller from a former colleague, I called on the property. She had an asking price in mind that was between $80,000 and $90,000. I had a buyer in the area that paid $60,000, top dollar, for a similar house in that location as a rental property. I even had recent solds to show the seller that they were asking a retail price.

She wasn’t budging on price, and I decided to go to the house anyway to determine amount of rehab so I could give her a set-in-stone figure.


Mistake #1: I forgot my comps.

The house needed quite a bit of work, and I managed to forget to bring my comparables to show them what was selling in the area. Therefore, I had absolutely no leverage to back up my statements, making it impossible for me to negotiate my way to convincing her to lower her price to meet the $60,000 where I needed to be.

Mistake #2: I miscalculated the rehab cost.

A week went by and she called to accept my offer at $60,000. So now it was time to get paid, and I had my buyer do a final walk through to vet the deal for themselves. As was most horribly unfortunate, it turned out that my rehab number was off due to a need for replacement of mechanicals.

Now, the buyer had to purchase the property at $50,000 in order to get a fair deal, so I went back to the seller to try and re-negotiate. At this point, the seller was furious and hung up the phone when I called with a even lower offer. However, luckily, two weeks went by, and they accepted the offer! Yes! It was finally time to get paid, have the contract signed, and all the legalities dealt with.

Related: The 3 Dumbest Mistakes Buy & Hold Real Estate Investors Make

I went to meet the seller with the contract, which is a standard purchase agreement used in my state. This is where I ran into my third mistake.


Mistake #3: I didn’t understand the purchase agreement.

I had zero experience in going over a purchase agreement when talking with a seller, and guess what? I completely butchered it! The seller backed out, and I lost the deal.

The point of this story is I learned so much from the experience, and I tend to never make the same mistake twice. It wasn’t fun failing, but it is better going out there and taking action versus standing on the sidelines. I hope you can learn from my past failures to help you in your endeavor.

Investors: What did YOUR first deal look like? What mistakes did you make — and learn from?

Let me know with a comment!

About Author

Sterling White

With just under a decade of experience in the real estate industry, Sterling currently manages over $10MM in capital, which is deployed across a $26MM real estate portfolio made up of multifamily apartments and single-family homes. Through the company he co-founded, Holdfolio, he owns just under 400 units. Sterling was featured on the BiggerPockets Podcast and has been contributing content to BiggerPockets since 2014, with over 200 posts on topics ranging from single-family investing and apartment investing to wholesaling and scaling a business.


  1. Shelly F.

    Oh My Goodness!!
    I am a brand new wholesaler, and despite my incredible fear, I am (finally) moving ahead. Of course I’m trying to avoid mistakes and losing credibility, but I know they are inevitable. I just got off the phone with a “prickly” seller who is a landlord of other properties and WAY more experienced than me….odds would have it he’d be among my first set of sellers to respond to my mailers!! I read your article with anxiety and appreciation….thank you for writing and speaking to my fears, right where I’m at!

  2. Jonathan Blandino

    I’m currently moving back to New Jersey with a 4 month layoff and reading into Wholesale. this article was great insight. Are there companies that do wholesaling? I would like to learn the ropes or maybe network helping someone who wholesales. Do you think I could get something rolling with 4 months off or should I just get back to work and save for a longer time off to get into wholesaling?

    • Sterling White

      Great question Jon without knowing too much context on your overall situation I will be unable to answer question fully. However if you do decide to pursue wholesaling I would partner with someone experienced. You can find this person at your local RE meetup.

      Hope that helps

  3. Rapy Narruhn

    Ahhh man!! Thank you for sharing your story! Definitely 3 things to always keep in mind.

    “Our brain is a simulation machine. We don’t have to make the mistakes to actually learn the lesson. You didn’t have to put your hand in the fire. You didn’t have to run across the street to get hit by a car. You can listen and learn and simulate that result without actually having to do it.”

    In this case…. You don’t have to forget the comps, miscalculate the rehab cost (though sometimes this happens without fault because things do come up as a surprise after the inspection) and not understand the purchase agreement because STERLING already showed us that doing these things doesn’t create the best results lol.

    Thank you again for sharing!

  4. Owen Buchanan

    I’m a new investor that just puchased a SF in a not so great area. Wasted lots of cash on horrible contractor that stole supplies, ran out of rehab funds, started rehabing w/o permits after bad advice from another RE investor …amongst other issues. It has been a huge learning eexperience for me that will propel me into my next deal!
    Thanks for being transparent.

  5. Sterling,

    Thank you so much for this post. My partners and I have been stuck in analysis paralysis. Our goal is to get our first deal done by May 1st only problem is saying we “don’t know where to start.” Brooklyn ,NY can be a tough market if we believe that but growing up here that cannot be an excuse to not move forward. None of us want to fail but thanks to your story, failure is totally necessary in building the muscles we need to get it done. Stay tuned for our first experience post.

  6. Zachary T. McConnell

    I am brand new to this have taken some real estate investing courses. Just filed my LLC today. I understand it takes weeks to get. How can I start wholesaling now? Can I just have the title lawyer do the deal in my name. I’m just going to be getting properties under contract, then having a double sale be completed by the title lawyer to my end buyer. Any tips?

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