Wholesaling an Apartment Building

Andrew Christie · 2014-02-05T14:11:58-08:00

So... I've got this apartment building under contract. I've advertised it to the two local REIA groups we have here and I have it posted on Craigslist. I've called several people in my network to let them know. I've had some interest, but people aren't currently breaking down the door to get it. I'm realizing that this might not be as quick and easy as I initially thought. I've told the seller it's a cash deal. I didn't volunteer the fact that I plan to assign the deal, so she thinks I'm buying it. I put March 15th as the closing date... so it might be rough to find a cash buyer who can close by then. So my question is, what are some strategies to sting this out. She has already told me that she would like to close by the end of the month because she's going out of the country. What can I say to her so that she won't be upset. I guess I have to give her some excuses. I was thinking about telling her that my "partner" is out of state. He hasn't seen it yet and he has to approve it. But then that will only last for so long. I don't want to lie, but then I don't want her to get upset either. I'm wondering if it would be best to be completely upfront and tell her that I'm looking for an investor to assign the deal to and explain that I have a lot of networking connections. I'm sure others have been in this situation. What have you done?

Eric Black

Rental Property Investor · Where we are parked · Member since 2013 · 584 posts · 178 votes

12y

Hi Andrew,

What type of deposit did you put down? If the contract expires and you don't close, that's what you lose...unless you didn't give yourself an escape clause. If you are having trouble finding a buyer then that typically means that it's not such a great deal for the price you are selling it for.

My first piece of advice, don't come up with excuses and lie to the seller. This will make you, and all other wholesalers/investors look bad. Be honest with her and tell her that after doing further research you feel the property is not worth the current contract price and see if she will negotiate with you. If she wants to get rid of it by the end of the month she may well. If she says she won't then tell her you won't be able to close then and you'll just let the contract expire. You can tell her that you are planning on reselling the property and that if you can get it for $XXX that you feel more confident that you will be able to find a buyer and close quickly.

Best of luck.

2 Reply

Andrew Christie

OP

Virginia Beach, VA · Member since 2013 · 33 posts · 0 votes

12y

Hey Eric:

I have an unlimited inspection period. So although I have a decent deposit, it's protected by the inspection clause.

I'm a licensed agent and think that if I don't get any hot interest soon, I will go ahead and list it as a contract owner. That will give it a lot more exposure. I've also been advertising it as cash only. I think I can drop that. As long as I have a qualified buyer, then what difference does it make? The seller wants cash, but her main priority is to sell. She's getting her cash either way.

If I have to stall for time, I can simply tell her that my partner doesn't approve due to the current condition. And then I can tell her that I'm still working on him, trying to change his mind. I can let her know that I also have other people interested and I think I can get her what she wants for it. What can she say? Her only other option is to back out of the contract and start all over. She might as well hold off and try getting the money while she can.

Wholesaling an Apartment Building

Most Popular Reply

44 Replies