Hi, I was wondering if creating an LLC is necessary before wholesaling my first deals? Or should I wait until I've wholesaled a couple houses? (Which would mean buying and assigning in my own name) I've also heard from others an S Corp is better for wholesaling. Any input appreciated
@Eseta Fuiava start with finding the deal. Too many noob investors want to start with trying to get a LLC, finding the right name for the LLC, getting a great logo, looking for the right business card.....yada yada yada.
By the time you get everything set up, you would have no idea on how to go about getting that first deal, you would then get frustrated and just give up. Spend your time learning how to knock down that first deal.You will get a better ROI with learning how to go after a deal then you will setting up your business.
Questions you have to ask yourself when you start looking for deals. How do you plan to market? Who do you plan on marketing too? How comfortable are you talking to sellers? How do you structure your offers to the seller? Analyzing the property ? and etc.
@Kevin Paulk thank you for your response! That makes a lot of sense. Worry about the small details later, focus on strategizing first. That was my initial plan. My only question is "legitimacy". I read on another forum someone suggested LLC first because you look more "legitimate" to a Seller, etc. Have you experienced a Seller questioning your legitimacy because you're buying in your name and not as a business? Or is this something I really shouldn't worry about?
@Eseta Fuiava Most of them just want to know if you are going to buy their house or not. You can read a ton of info on this platform as well as others that tell you to go up, down, left, right but you're not going to know what works for you until you go out there and take action.
So if you talk to 10 sellers and all discuss with you how are you going to pay them and you have no clue, then it looks like funding the deal would be more important than putting together a LLC. Test the waters, take action and adjust along the way!
@Kevin Paulk thank you so much! I really appreciate your advise!
GREAT ADVICE. I was going to say the exact same thing.
The only reason you would need an LLC is for liability reasons in case you piss a seller off and they sue you, tax implications and business banking.
If you aren't generating any revenue yet, no need to worry about a LLC. Go find a deal.
@Blaine Alger thank you! I will definitely forego the LLC until I get more experience. Thank you!