Off Market Deals

[Anthony Howell]

Can anyone tell me what the commission they are paying to agents/people for off market deals? Thanks

[Nicholas L.]

@Anthony Howell

none if it's off market...

[Anthony Howell]

Quote from @Nicholas L.:

@Anthony Howell

none if it's off market...

 What benefit is it to an agent or individual to bring an investor a deal if not for so sort of compensation? I would imagine it should probably be in the neighborhood of 2.5-3%.

[Nicholas L.]

@Anthony Howell

wholesalers surface off-market deals for investors.  they generally don't charge a "commission" - they just build a fee into the price they advertise to the investor.

agents generally do not or cannot do this.

[Scott E.]

It varies so much. I've had wholesalers bring me deals where the margins are razor thin and they're willing to flip the contract for $3,000 just to get the deal done.

The biggest "fee" I've ever paid a wholesaler was $100k. Meaning I paid $100k more than their contract price. But I didn't care how much money they made. Why? Because the numbers still made sense for me at the price I paid.

[Bob Stevens]

Quote from @Anthony Howell:

Can anyone tell me what the commission they are paying to agents/people for off market deals? Thanks

You mean if you find a deal how much is your  "bird dog " fee? 

[Anthony Howell]

Quote from @Bob Stevens:

Quote from @Anthony Howell:

Can anyone tell me what the commission they are paying to agents/people for off market deals? Thanks

You mean if you find a deal how much is your  "bird dog " fee? 

Yes?

[Anthony Howell]

Quote from @Anthony Howell:

Quote from @Bob Stevens:

Quote from @Anthony Howell:

Can anyone tell me what the commission they are paying to agents/people for off market deals? Thanks

You mean if you find a deal how much is your  "bird dog " fee? 

Yes?

Yes.

[Anthony Howell]

Quote from @Scott E.:

It varies so much. I've had wholesalers bring me deals where the margins are razor thin and they're willing to flip the contract for $3,000 just to get the deal done.

The biggest "fee" I've ever paid a wholesaler was $100k. Meaning I paid $100k more than their contract price. But I didn't care how much money they made. Why? Because the numbers still made sense for me at the price I paid.

I am not dealing with a wholesaler. I am dealing with an individual who knows a person selling a property and they would like some sort of compensation for bringing me the deal.

[Bob Stevens]

Quote from @Anthony Howell:

Quote from @Anthony Howell:

Quote from @Bob Stevens:

Quote from @Anthony Howell:

Can anyone tell me what the commission they are paying to agents/people for off market deals? Thanks

You mean if you find a deal how much is your  "bird dog " fee? 

Yes?

Yes.

All negotiable, Get to a RE meeting, you are no ready to look for deals ,,,,,,yet. Do you know how to get the ARV? Do you know how much for reno ? You are asking the wrong question ,for now. Learn 1st. You do not even have a deal, and your worried about your fee :)

[Bob Stevens]

Quote from @Anthony Howell:

Quote from @Scott E.:

It varies so much. I've had wholesalers bring me deals where the margins are razor thin and they're willing to flip the contract for $3,000 just to get the deal done.

The biggest "fee" I've ever paid a wholesaler was $100k. Meaning I paid $100k more than their contract price. But I didn't care how much money they made. Why? Because the numbers still made sense for me at the price I paid.

I am not dealing with a wholesaler. I am dealing with an individual who knows a person selling a property and they would like some sort of compensation for bringing me the deal.

 If all they are doing is bringing you a deal then throw them a few k, 

[Anthony Howell]

Quote from @Bob Stevens:

Quote from @Anthony Howell:

Quote from @Anthony Howell:

Quote from @Bob Stevens:

Quote from @Anthony Howell:

Can anyone tell me what the commission they are paying to agents/people for off market deals? Thanks

You mean if you find a deal how much is your  "bird dog " fee? 

Yes?

Yes.

All negotiable, Get to a RE meeting, you are no ready to look for deals ,,,,,,yet. Do you know how to get the ARV? Do you know how much for reno ? You are asking the wrong question ,for now. Learn 1st. You do not even have a deal, and your worried about your fee :)

 Bob, I have a deal done. I’ve already run all of the numbers. I am closing on Tuesday. The gentleman who brought the deal to me is not assigning the contract to me, therefore, technically not a wholesaler. I am interested to know what fair compensation would be for this individual if the deal is for 100k? Thanks

[Anthony Howell]

Quote from @Bob Stevens:

Quote from @Anthony Howell:

Quote from @Scott E.:

It varies so much. I've had wholesalers bring me deals where the margins are razor thin and they're willing to flip the contract for $3,000 just to get the deal done.

The biggest "fee" I've ever paid a wholesaler was $100k. Meaning I paid $100k more than their contract price. But I didn't care how much money they made. Why? Because the numbers still made sense for me at the price I paid.

I am not dealing with a wholesaler. I am dealing with an individual who knows a person selling a property and they would like some sort of compensation for bringing me the deal.

 If all they are doing is bringing you a deal then throw them a few k, 

 Thank you.

[Bob Stevens]

Quote from @Anthony Howell:

Quote from @Bob Stevens:

Quote from @Anthony Howell:

Quote from @Anthony Howell:

Quote from @Bob Stevens:

Quote from @Anthony Howell:

Can anyone tell me what the commission they are paying to agents/people for off market deals? Thanks

You mean if you find a deal how much is your  "bird dog " fee? 

Yes?

Yes.

All negotiable, Get to a RE meeting, you are no ready to look for deals ,,,,,,yet. Do you know how to get the ARV? Do you know how much for reno ? You are asking the wrong question ,for now. Learn 1st. You do not even have a deal, and your worried about your fee :)

 Bob, I have a deal done. I’ve already run all of the numbers. I am closing on Tuesday. The gentleman who brought the deal to me is not assigning the contract to me, therefore, technically not a wholesaler. I am interested to know what fair compensation would be for this individual if the deal is for 100k? Thanks

ALL HE did was find it, give him what you think is fair, its all about the numbers

[Scott E.]

Quote from @Anthony Howell:

Quote from @Scott E.:

It varies so much. I've had wholesalers bring me deals where the margins are razor thin and they're willing to flip the contract for $3,000 just to get the deal done.

The biggest "fee" I've ever paid a wholesaler was $100k. Meaning I paid $100k more than their contract price. But I didn't care how much money they made. Why? Because the numbers still made sense for me at the price I paid.

I am not dealing with a wholesaler. I am dealing with an individual who knows a person selling a property and they would like some sort of compensation for bringing me the deal.

That's wholesaling. The only difference is that they are not putting the property under contract first, because they trust you.

So my feedback above still applies. No fee is too little or too high. You need to underwrite the deal and figure out exactly how much you can afford to pay for it.

[Luka Milicevic]

This very much depends and not entirely up to the buyer. 

This is more of a negotiation between the person that has the deal under contract and the seller.

Most off market deals will come from either you talking to the seller directly, or a wholesaler. Some investor focused agents can get you off market deals. 

If it's direct to seller, you don't have to pay anyone a commission. 

If it's an agent, it will more than likely be 3% of the final sales price.

If it's a wholesaler it can vary greatly. My largest wholesale fee I have paid was $95k, and it was the best deal I've ever done. 

[Anthony Howell]

Quote from @Scott E.:

Quote from @Anthony Howell:

Quote from @Scott E.:

It varies so much. I've had wholesalers bring me deals where the margins are razor thin and they're willing to flip the contract for $3,000 just to get the deal done.

The biggest "fee" I've ever paid a wholesaler was $100k. Meaning I paid $100k more than their contract price. But I didn't care how much money they made. Why? Because the numbers still made sense for me at the price I paid.

I am not dealing with a wholesaler. I am dealing with an individual who knows a person selling a property and they would like some sort of compensation for bringing me the deal.

That's wholesaling. The only difference is that they are not putting the property under contract first, because they trust you.

So my feedback above still applies. No fee is too little or too high. You need to underwrite the deal and figure out exactly how much you can afford to pay for it.

That’s a huge distinction, because the wholesale fee is included in the assigned contract.

[Anthony Howell]

Quote from @Luka Milicevic:

This very much depends and not entirely up to the buyer. 

This is more of a negotiation between the person that has the deal under contract and the seller.

Most off market deals will come from either you talking to the seller directly, or a wholesaler. Some investor focused agents can get you off market deals. 

If it's direct to seller, you don't have to pay anyone a commission. 

If it's an agent, it will more than likely be 3% of the final sales price.

If it's a wholesaler it can vary greatly. My largest wholesale fee I have paid was $95k, and it was the best deal I've ever done. 

Thank you. That was my inclination as well, which I referenced in one of my posts above. I was just looking for confirmation that I’m not totally off base in what I wanted to give him.

[Anthony Howell]

Thank you everyone for all of the responses . It is incredibly helpful.

[Bob Stevens]

Quote from @Nicholas L.:

@Anthony Howell

none if it's off market...

 WHY not pay someone a fee for finding you a deal ?

[Bob Stevens]

Quote from @Anthony Howell:

Thank you everyone for all of the responses . It is incredibly helpful.

 Just pay what you want its good karma, :) 

[Anthony Howell]

Thank you everyone for all of the responses . It is incredibly helpful.

[Nicholas L.]

@Bob Stevens

totally agree.  he just threw me off when he said "commission" initially =)

[Dan Heuschele]

Has the bird dog suggested a finder's fee amount?  Does it seem reasonable?  Is the purchase still a good deal?

I paid $20k to a bird bog for a good property.

We negotiated $15K.  He asked for more and I informed him that I did all my underwriting at $15k and it met my return expectations and there did not commit to paying him more than the negotiated amount.  However, the bird dog had to do more hand holding than he had anticipated and it was a great deal so I paid him $5K over the initial negotiated fee in hopes that he would bring me a similar great deal again.  He has sent me quite a few offers, but none approach the first one.  He has been buying the best values himself which is understandable.

Hopefully because I paid him the additional $5K I am at or near the top of his buyers list.  If so, it may pay dividends.

I suggest you evaluate what the bird dog desires as compensation and consider paying it if the deal warrants it.  It may pay dividends in the future, but it if does not you still got a good deal.

good luck