Hey BP, If I find a property on the MLS how would I contact the seller. Also how does all the contracts work. Does the realtor get paid from me or the seller.
get your own realtor to represent you, especially on your first property or two. They contact the seller's agent for you and handle all the contracts. Both agents get paid by the seller, so it's nothing out of pocket to you and will be helpful for learning
If you find it on MLS more than likely the seller has a listing contract with an agent which means you have to contact the agent. The agents on both sides of the deal get paid from the seller unless a broker you're buying with has an additional fee which some do but most don't. When buying it doesn't hurt to have a realtor/agent because you're not paying for their commission.
do I use the starndard purchase and sale agreement and assignment agreement still.
And what the difference between a realtor and an agent
a Realtor is a member of the trade association known as the National Association of Realtors (plus usually several local associations) and these associations are the groups that maintain the MLS. An agent is someone only licensed by their state's department of professionals to conduct business in real estate sales. A Realtor infers a higher level of professionalism (usually) and the strength of the associations' network and MLS information systems. It's going to be tough to wholesale properties that are found on the MLS because most of the people you would wholesale them to also have access to view them through the MLS via their own Realtor. I say this because of your mention of an assigned contract. If you're looking for your own project, you should contact an investor friendly Realtor and they can help you source properties on the MLS (and sometimes from their own network of off-market deals). For an MLS property you should be fine using the standard contract for your state which the Realtor will help you prepare.
In Colorado the fees involved with a property that is listed on the MLS can be around 2.8% for the Lsting/Selling Agent or Broker, and another 2.8% for the Buying Broker or Agent. All of the fees are paid by the seller of the house. There are many discount selling agents out there that will sell your properties for less than the usual 2.8% but they do not provide as many services and advertising as a regular Agent/Broker. A good Broker is worth the 2.8% commission that he or she earns for a seller that is not a Real Estate Investor or "flipper".
Many For Sale By Owner properties end up getting listed by a Realtor or Agent since most FSBO's do not have any expertise in marketing their properties to get their asking price.
If you are dealing with Broker to purchase a property, he or she should suggest that you get a home inspection done on the property. The fee for this will come out of your pocket but it can save you thousands if you end up having to fix some things before putting the property up for sale. Even if the seller does disclose any known problems with a house, they might not know about termites, water damage, or even major code violations on renovations that were completed without getting building permits.
Wholesaling houses usually means that you never own the house, but just assign a contract to buy the house. Even if you have a cash buyer lined up, he or she might not close on the property if they find major problems that is not disclosed. There goes your assignment fee. I have not done any wholesaling so I do not know if Wholesalers have Home Inspections done by a professional or not. I would think that spending $250-500 for an inspection would be worthwhile to make sure that the house you are putting under contract is really worth the amount that the distressed seller is asking.
Have a great day,
@Jamaal McDonald I'm biased because I'm a licensed agent but not a Realtor(c), but from everything I've heard, being a "Realtor" does nothing in terms of making you a better agent. Just my $.02.
Whenever you do get hooked up with an agent (or Realtor) have him/her set you up with automatic listing updates. You can set criteria then be emailed every time a listing matching comes up. You can set it up to be daily, weekly, or instantly.
As Jon pointed out, it's tough to find deals on the MLS, but it can be done if you're quick.
@Jean Bolger really nailed it above!
I have an agent that presents my offers for listed properties, and that's in my best interest because their commission is ultimately paid by the seller, not me. An even better scenario for an investor is to also BE an agent (or be married to one), then you (or your spouse) can capture commissions as well.
Originally posted by @Adrian Tilley:
I'm biased because I'm a licensed agent but not a Realtor(c), but from everything I've heard, being a "Realtor" does nothing in terms of making you a better agent. Just my $.02.
Hi @Adrian Tilley,
This is an older post but I am interested in how things are working out for you without being a Realtor. I recently received my license and I have to join the state and local associations in order to get access to the MLS. Does it work different for you? The membership fees on top of the MLS fees seems excessive for someone starting out.
Would you mind letting me know how things have gone for you without joining the NAR? I realize there are benefits to joining but I am not one to fork out money without knowing it will provide value.
You must be a BiggerPockets member to post on the forums
Join the world's largest, most open Real Estate Investing Community online, 100% free forever!