Real Estate Wholesaling

4 Steps to Get Started in Wholesaling (While Minimizing Your Chances of Failure)

Expertise: Personal Development, Real Estate Wholesaling, Real Estate Investing Basics
96 Articles Written
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Someone recently said to me, "What steps can I take to get started wholesaling? I cannot afford to fail."

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When answering the question of the gentleman, I first informed him the reality of wholesaling and that failure is a part of the process. I told him that marketing is the most important piece of wholesaling. When marketing, failure will present itself immediately; you will receive a limited response from those you’re marketing to. However, you have to find a way to set aside your fear of failing and persevere. We began to review these simple and practical steps. This may not be as in-depth as you would like, but these few practical steps will help you tremendously in your journey.

1. Study

Everyone want to be a professional at their craft, but the majority of the people do not want to study. I believe this first step is essential. This may sound elementary, but there are so many newbies I see who review one course by a guru and believe they know the ins and outs of wholesaling. Granted, it is not rocket science, but you need to be astute because you are working with most people’s largest asset.

There are many resources to educate yourself with such as blogs, podcasts, webinars, seminars, and mentors.

business-plan

Related: 5 Smart Strategies for Newbie Wholesalers to Find an End Buyer

2. Network

This is highly important when trying to get started when you can not afford to fail. Begin networking. Seriously, you should have business cards and hand them out to everyone you meet. Discuss what you do and have confidence when you are giving your elevator pitch to anyone who is willing to listen.

I got my first deal because of my network. I made it a habit to attend at least 10 open houses a weekend just to meet real estate agents — and one of those agents sent me a deal that helped me get started. It is important to attend open houses and real estate club meetings, join Facebook groups, and participate in the BiggerPockets Forums. By networking, you will begin to build your team. Everyone thinks they simply need to find a deal, but once you have your deal, you will need someone to sell it to. You will need an attorney and title company to facilitate the transaction, so networking isn't just about finding the deal but about bringing the deal to close.

3. Marketing

You should know this by now; if you’ve been doing any studying or research on wholesaling you are aware that marketing is the most important piece.

You need to purchase a list of sellers to market to. You need to be consistent in your marketing according to your budget. (Please create a budget — do not throw caution to the wind and dump everything you have in one mailing or one batch of bandit signs. You will need to budget for mailing consistently.)

A budget for bandit signs is great to have, as well as a budget for mailing to buyers. So creating an overall budget is great, but you will need to scale it down according to your different forms of marketing. A website is not needed in the beginning, so don't waste time and money starting with that. The need for a website will eventually come, and it is good because it validates you, but it's not needed when getting started.

short-sale-process

Related: 4 Steps to Landing a Wholesaling Mentor as a Complete Newbie

4. Systems

Create a system for everything you do, especially for your marketing. One of my biggest mistakes was randomly planting bandit signs without creating a system for it. Now I've created a rotating schedule for each area I am going to place signs. It is great to outline your systems while you're a small operation, and it can expand with you when you expand.

There should be a system for everything you do. In business, these systems are called standard operating procedures (SOPs). These SOPs are your system processes, and they should answer the following questions:

  • Why am I doing this?
  • Why is it important to do it this particular way?
  • How do I do it?

This is not only for you, but for those you hire once your operation expands.

These four practical steps will help you go a long way. Again, I did not go into depth on each one because each one is a subject within itself. Make sure you research and study each practical step and then get going.

Is there a step that you believe I may have overlooked that could help others?

Please add you input in the comments section below!

Marcus Maloney is a value investor and portfolio holder of residential and commercial units. He has completed over $3.3 million in wholesale transactions. Currently, Marcus is a licensed agent who ...
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    Huguens Louis-pierre tutor and math teacher from West Palm Beach, Florida
    Replied almost 4 years ago
    very specific and useful. thanks marcus!
    Marcus Maloney Wholesaler from Queen Creek, AZ
    Replied almost 4 years ago
    Huguens, Thanks for reading I’m glad I can help. “Enjoying the Journey”
    Benjamin Barredo Wholesaler from Knoxville, Tennessee
    Replied almost 4 years ago
    Great article Marcus. I’m a brand new wholesaler. I’m about to start my mailing campaign but I just started thinking about the fact that I need a consistent budgeted plan. What do you suggest to have in my plan for a budgeted campaign?
    Marcus Maloney Wholesaler from Queen Creek, AZ
    Replied almost 4 years ago
    Benjamin, I would suggest you have a budget for about 6 months, even if you’re sending 50 a week. Its good essential that you be consistent. The main thing is that you’re taking action. “Enjoying the Journey”
    Kevin Leonce Investor from Atlanta
    Replied almost 4 years ago
    Thanks for the info Marcus. I had three out of the four but I’m now figuring out the marketing part.
    Daniel Sisto Rental Property Investor from Liverpool, NY
    Replied almost 4 years ago
    Great Article! Only thing I have to say, is that a website is not only used as validation or credibility but should be used a lead generating source.
    Marcus Maloney Wholesaler from Queen Creek, AZ
    Replied almost 4 years ago
    Daniel, You are right I failed to mention that, thanks for adding that marketing tip. “Enjoying the Journey”
    Marcus Jackson from San Antonio, Texas
    Replied almost 4 years ago
    Thank you for the great tips. Some of these I already did on my own but knowing that I’m doing things the right way makes me feel even better. Good luck to you all.
    Marcus Maloney Wholesaler from Queen Creek, AZ
    Replied almost 4 years ago
    Marcus, Use this article as validation, since you’re starting and doing whats needed…..Keep going and do not let anything or anyone stop your progress. Thanks for reading. “Enjoying the Journey”
    Nate Kooiman from Edinburg, Texas
    Replied almost 4 years ago
    Thanks Marcus, What system do you use to keep track of marketing/follow ups? I would imagine that keeping track of the data produced by mailing list is crazy.
    Marcus Maloney Wholesaler from Queen Creek, AZ
    Replied almost 4 years ago
    Nate, Sorry for some reason I did not get your comment, I use Podio, its a CRM that will track your mail, inbound calls, lead funnels, everything its really good. There are others but I am fond of this one. Other people use freedom soft. Glad I could help “I’m Enjoying the Journey”
    Jeric L. Investor from Rancho Cucamonga, CA
    Replied almost 4 years ago
    This is very educational and helpful, thank you Marcus for doing what you’re doing, in educating and helping people about this business! More power to you!
    Marcus Maloney Wholesaler from Queen Creek, AZ
    Replied almost 4 years ago
    Jeric, Thanks for reading man, I try to help people who are truly trying to get out of the rat race. I have more information and videos at equityrealestateblog.com “I’m Enjoying the Journey”
    Marques Johnson from Ellenwood, Georgia
    Replied almost 4 years ago
    Thanks, Marcus. I seem to be running into a lot of your posts now, and all are helpful, well thought out, and articulate.
    Marcus Maloney Wholesaler from Queen Creek, AZ
    Replied almost 4 years ago
    Marques, That’s great, that means you’re educating yourself a lot. Glad I could help. I have other resources and tools at equityrealestateblog.com, where I go further in depth come on over and join the conversation. “I’m Enjoying the Journey”
    Altamar Knighton Flipper/Rehabber from Edison, NJ
    Replied over 3 years ago
    On point again! I am reading all of your post Marcus. Great content. Thank you!
    Charlene Garrison Investor from Detroit, MI
    Replied about 2 months ago
    Marcus, Thanks for the great tips. I read this closely and I intend to use this advice. Thinking about your SOPs is a good thing to do, right from the start. These steps will help me a lot. Thanks again, Charlene