investment property<\/a>.<\/p>\nWhat is your exact criteria? Do you like investing in select areas? Do you look for specific return rates or purchase prices that are within a certain percentage of the market value?<\/p>\n
Inform your wholesaler in detail exactly what it is you look for, and then tell them you don\u2019t want to see anything else unless it fits that criteria.<\/p>\n
This way, your wholesaler will stop bringing you \u201cbad\u201d deals and will be more likely to bring you the \u201cgood\u201d ones (or more specifically, ones that meet your criteria) first because they know they have a guaranteed buyer, and they won\u2019t have to shop around.<\/p>\n
Now, if you say that you will buy property that matches X criteria and they actually follow through and bring you a deal that does that, you actually need to follow through and buy it. Otherwise, you\u2019ll end up looking like a flake.<\/p>\n
I like to think of it this way: If someone says to me they\u2019ll buy X and I bring it their way, if they don\u2019t end up actually buying it (especially if they tied it up under contract), I almost treat it like a grading system (yes, my inner teacher is showing).<\/p>\n
If on the first interaction I have with them, they don\u2019t buy or they back out, it\u2019s an automatic failure to me. Moving forward I\u2019m not going to consider them a serious buyer, and they\u2019ll be put at the bottom of my buyers list.<\/p>\n
But if they have bought, say, nine deals from me, and then they end up backing out of one, it\u2019d be like having an A- or 90%; I\u2019d still work with them in the future, but not in the same way as if they were at 100%.<\/p>\n
Your Word Is Everything in Real Estate<\/h2>\n
The biggest asset you can have in this business is your word. If you say you’re going to do something and our relationship proves that I can trust that you\u2019ll actually follow through with what you say, that is what will distinguish you from the crowd and get you at the top of my buyers list.<\/p>\n
In my business, sometimes I work with other wholesalers if there is enough meat on the bone and will purchase their properties to turn around and wholesale it myself.<\/p>\n
In particular, there is one wholesaler that I\u2019ve worked a lot with throughout the years.<\/p>\n
Recently, there was a property he had that\u00a0I made an offer on and got under contract, only to find out that there were some really serious tax issues with the house, and my margin was turning out to be about break-even at best.<\/p>\n
Because I was cutting it too close, I began to think about backing out and actually discussed it with him.<\/p>\n
In our conversation he said, \u201cBrett, I totally understand if you want to back out, and I know that this isn\u2019t typically like you. You\u2019ve never backed out of anything with me previously. However, I do want you to know, if you make the decision to back out, I will have to take this decision into consideration in the future.\u201d<\/p>\n
I really value my relationship with this wholesaler, and I didn\u2019t want to do anything that would hinder it, so in the end, I stuck to my word and ended up going through with the purchase (knowing that I may lose a little money).<\/p>\n
My word and my reputation with him meant more to me than the risk on that deal, and if you are looking to get all you can out of a relationship with a good wholesaler, sometimes it takes that kind of integrity to make it happen.<\/p>\n
The 4 Types of Cash Buyers You Don\u2019t Want To Be<\/h2>\n
To break down my point further, I thought we\u2019d have a little fun and introduce to you the four major buyers you don\u2019t EVER want to be.<\/p>\n
1. Mr. Backout<\/h3>\n
Mr. Backout is the guy who talks like a big buyer. He\u2019ll come off the cuff saying, \u201cI want to buy 50 properties a month,\u201d and I\u2019m like, \u201cWow, man! Let\u2019s start off with one for now and see how things go.\u201d<\/p>\n
You see, this business, at least in my experience, is all about relationships. If I don\u2019t know you, we don\u2019t have history for me to trust you yet. We need time and deals together before trust can begin to develop.<\/p>\n
Mr. Backout will then move forward on a property I send him, get it under contract, stall for a week or two and then for some random reason will back out of the deal because it wasn\u2019t \u201cperfect.\u201d<\/p>\n
Now, it\u2019s totally fine if you need the deal to be \u201cperfect\u201d; I\u2019m not bashing people looking for very specific criteria, but don\u2019t be the guy who ties up the property for weeks and then backs out, because that makes things frustrating for everyone involved.<\/p>\n
I\u2019m not trying to come across as \u201cholier-than-thou,\u201d so please don\u2019t misunderstand me.<\/p>\n
I personally have backed out of a few deals myself over the years, but they were all under extreme circumstances, and all had very good reasons behind not going through with it.<\/p>\n
Mr. Backout is the guy who backs out of contract more than he actually buys property–and for reasons that don\u2019t really add up.<\/p>\n
Don\u2019t be that guy!<\/p>\n
2. Mr. \u201cI\u2019ll Buy Anything You Have\u201d<\/h3>\n
Guys, I\u2019m going to be honest. When I hear a buyer say this, I roll my eyes.<\/p>\n
Cash buyers talk WAY too big.<\/p>\n
You won\u2019t buy everything. If I send you a deal that is 100% over market value, are you going to buy that?<\/p>\n
Nope!<\/p>\n
I get really leery when cash buyers come to me saying, \u201cWe are a huge company, and we\u2019ll buy all you have!\u201d\u00a0People who start off our relationship that way have ended up being the biggest headaches I\u2019ve dealt with.<\/p>\n
3. Mr. No Earnest Money<\/h3>\n
This is the buyer who claims that because they move so quickly since\u00a0they are so big, they can close in two days, and they are above putting down earnest money.<\/p>\n
Recently I had a buyer do just that. He tied up two properties on Monday and said we could close on Thursday, and well, it didn\u2019t happen.<\/p>\n
Two weeks later he did finally close on one, but the other is still pending, and it\u2019s super frustrating!<\/p>\n
Moving forward, this buyer isn\u2019t going to be my first choice to work with because I can\u2019t trust that he\u2019ll do what he says.\u00a0Not something you want to do!<\/p>\n
4. Mr. \u201cI Want Something For Nothing\u201d<\/h3>\n
A while back, I had a hot property that had just been purchased, and I had a buyer I have never met call me up asking about it.\u00a0I said, \u201cOh sorry sir! That property was already snatched up,\u201d and he responded, \u201cOh, man! Well, can you do me a favor?\u201d<\/p>\n
I was curious because like I said, I had never spoken with the guy before, but I said, \u201cWell, what would that be?\u201d<\/p>\n
\u201cCan you send me your deals first, before anyone else?\u201d<\/p>\n
And I was like, \u201cUmmm. . .\u201d<\/p>\n
And again, please don\u2019t misunderstand me. I\u2019m not picking on anybody! These are just behaviors I have seen from cash buyers that really turn me off as a wholesaler, and my goal is to help bridge the gap between the two.<\/p>\n
I want investors and wholesalers to work well together because when the relationship is done right, it\u2019s a win-win for everyone.<\/p>\n
But for Mr. \u201cI Want Something For Nothing,\u201d he needs to understand that my top buyers have bought multiple properties from me throughout the years and have earned my trust and respect.\u00a0They deserve to be on the top of my buyers list.<\/p>\n
Why would this guy think he should get special treatment from without even knowing me?\u00a0Not the way you make friends!<\/p>\n
Related:<\/strong> The Importance of Working With a Good Wholesaler (or How I Landed Two New Deals in the Last 7 Hours)<\/a><\/em><\/p>\nConclusion<\/h2>\n
To sum it all up this week, the two takeaways are to be a person of integrity and follow-through and to understand the importance of relationships.<\/p>\n
If you understand these two things and you do them well, with time you\u2019ll become the guy wholesalers go to first with their deals.<\/p>\n
Hope this post was helpful this week!<\/p>\n
Wholesalers: How do you choose which of your buyers to contact about deals first? Buyers: What tips or advice do you have for working with wholesalers?<\/em><\/p>\nLet’s get the conversation going in the comments section!<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"The other night, I attended a local investor meetup in my area.\u00a0There was quite a turnout, and one of my favorite portions of the night was a Q&A session.\u00a0During the […]<\/p>\n","protected":false},"author":12142,"featured_media":75396,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[5526],"tags":[],"class_list":["post-75388","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate-wholesaling"],"acf":[],"comment_count":0,"_links":{"self":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/75388","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/users\/12142"}],"replies":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/comments?post=75388"}],"version-history":[{"count":0,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/75388\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media\/75396"}],"wp:attachment":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media?parent=75388"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/categories?post=75388"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/tags?post=75388"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}