My First Wholesale Deal....Need HELP!

6 Replies

Hi BP

I'm a long term investor....A Friend of my parents want to sale their house to me. They moved to a newer house a year ago & this one is currently rent out. Now they want to sale. 

  House estimate $70,000

  Repair need $8,000

  Currently rent $700/month

  Seller Agreed To Sale  To Me At  $52,000

My plan is to wholesale for quick profit or if not keep it for rental.  I'm going to get it under contract in next couple days & then find end buyer.  I'm going to targeting residential buyers & Investors. 

MY QUESTIONS ARE:  1) Are the numbers look good?  2) Can I use "West Michigan Regional Purchase Agreement" to get it under contract? Or 3) what form do I need to use in Michigan?  4) What are all the fees I need to pay if I wholesale?  5) If I pay cash & keep it for rental what are the fees I have to paid? 6) If I sell what price should I advertise to sell?  REMEMBER  seller don't want to pay any fees.  Thanks

John Wilson good luck let me know how it turns out!

@John Wilson - Do the sellers know that you are trying to wholesale their property? The margins look pretty thin to me. 

Why are they agreeing to sell the house for 18k under value?

What are the expenses for a buy and hold?  There might be a deal for you to buy and hold if the expenses are not too high.  How would it compare to your current properties in terms of cash flow and appreciation potential?

If your seller is not expecting you to wholesale - don't do it.  You very well could burn relationships on both ends(buyer and the seller).

1) Assuming your estimates and repairs are right you'll need to get the house under contract for at least 20k less than the agreed sale price for a quick wholesale.

2) If it's assignable yes.

3) if you need help with forms let me know ( I'm in your market) 

4) no fees at all

5) closing costs 

6) read number 1 again 

Happy to help! 

where is it?  basement?  3 rooms? 

I agree with @Nicasio T. , the spread seems too thin.

The 70/30 rule of thumb is good to keep in mind.

Make sure that purchase price + repairs is no more than 70% of the ARV.

Good luck!

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