Hello BP Family...hope all is well.
Here's my question:
If a Wholesaler presented you a deal and/or property he/she had under contract and you decide you want to purchase it after running the numbers and seeing pictures...What would be the step by step process from start to finish?
Example: 1) GC estimate
And so on.
This would be a cash purchase.
No real estate agent involved.
It needs rehab work.
This would be a long distance investment.
If you can add any dos (or) donts along the way, that would be great.
So grateful for your time.
@Aaron Lee Murphy first step would be to get a buyers agent. A "wholesaler" is most likely a person that just got on BP yesterday, knows nothing about comps, and found and elderly person that allowed them to put the house "under contract"
a real estate agent can tell you the true value, and you can make decisions on real numbers. It scares me when you talk about "running numbers" after "seeing pictures"
First of all...I’d like to thank you for your response. Actually you couldn’t have been more wrong about the “Wholesaler”. @David Torres has actually been a long time active member on BiggerPockets since 2013. And out of the kindness of his heart has reached out to help alot of newbies get started. I’m quite sure he's familiar with comps and I’m pretty sure he doesn’t prey on the elderly. So please be kind!!
Also, I’m not doubting the fact that some real estate agents can determine true value...not quite sure what you mean by real numbers. In the end, its always up to the RE investor...not the agent when doing due diligence (i.e. running numbers) etc. A GOOD agent can be an investor’s best friend, but ultimately it’s the investors money on the line.
You might have misunderstood my post. I never said I ran numbers after seeing pictures...
I said ... “IF” someone and/or I wanted to purchase the property after running the numbers and seeing pictures, What would be the step by step process.
I wrote this post for a reason..
1. Because I genuinely wanted to know the actual step by step process when working with a wholesaler without an agent...not only for myself, but for anyone else that might be interested in knowing.
Your response did not provide me with what I was looking for. So again, I welcome you to give your imput on what the step by step process would be when working with a wholesaler without an agent. If you can do that without bias or prejudice...It would be greatly appreciated.
So grateful for your time. Have a great day!!
@Brandon L. I agree with you on getting a trusted agent on the ground. They can guide you on what finish levels are appropriate, and set you up with a good contacts (title company, etc).
However, I partially disagree with you about running "real numbers" . The agent will be able to give you an estimation of the ARV, but most won't know anything about running the numbers for the repairs and rehab.
@David Torres , you're right that it takes a team! I remember seeing you say once that rehabbing in Santa Fe was tough from Albuquerque and I got a good laugh as I was overseeing a rehab in Roswell, NM from the Middle East!
This is nothing new, but it definitely does take a huge team. @Aaron Lee
@Aaron Lee Murphy , here are some of the things I set in motion right away.
Set up an inspection. I usually put in my offer that offer is not subject to inspection, however, being long distance it's invaluable to have one. I ask for as many photos as possible. I also try to coordinate for my handyman(or contractors) as well as my property manager to be at the house during the inspection to get the information I need.
POA. Some states require a wet ink signature in order to take title. In New Mexico they do, so I always get the POA documents set up right away. Although my newest solution was to set up an LLC and make my signee a Manager so that he can now perform my bank operations as well as sign all documents.
Next, I start lining up things that in my experience can sometimes end up in delays...I get quotes and set start dates for things like hauling trash, yardwork (which I like to do first), roof estimate, hvac, etc all while under contract when possible.
The final thing I suppose would be to make sure you have the right GCs. If you don't have one, or a couple in mind then get creative in looking. I've built my network though asking everybody to recommend someone. My current team was referred from a family member. To get my plumber, I called up a property management company and asked for a recommendation. My roofer was referred by my realtor and the list goes on and on.
Thank you so much for your input Aaron. This is exactly what I was looking for.
A couple of quick questions, if you don't mind.
Since my Mom lives in Sandia Park, NM...Can I give her POA to sign docs for me?
Also, Do you allow your GC to hire out subs for the work they don't do, or do you bring in your own guys?
I know it depends on the condition of the property...What is your average Rehab costs on something you would BRRRR
Once again, I'm so grateful for your time.
Great discussion! Thanks to all for sharing your insights and experience.