Wholesellers being called out in S.Florida

Buying & Selling Real Estate
10yFollow

Wholesellers being called out in S.Florida

Rod Desinord
Real Estate Agent · Pompano Beach, FL · Member since 2015 · 249 posts · 73 votes

I saw commercials down here in south florida within the past week from a company calling out wholesellers. Commercial basically said "why sell your house to a so called cash buyer who doesnt have the money?" it continued to give their number where people could call them to sell the home. Seems to be getting super competitive now/ 

0Reply
56 views

Most Popular Reply

Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
10y

In any state, when you execute a purchase contract you must have the intent to purchase and the ability to do so, this is basic contract law, nothing to do with real estate license law. If you do not intend to purchase as stated in the contract then you are not acting in good faith nor are you expressing your true intentions which is lying, you contract is voidable. If you do intent to purchase, honestly and can show that you can do so but then change your mind, you can assign a contract. But, if you never buy and enter contracts that you always assign, the fraudulent dealing becomes obvious. :) 

6Reply
See this reply in the discussion

31 Replies

Jump to latestLatest
  • Lamar Tisdale
    Investor and Agent · Fort Lauderdale, FL · Member since 2014 · 30 posts · 11 votes
    10y

    @rod desinord

    Really that's interesting kinda shady and desperate IMO. I'm curious to know the name of the company. Remember this no ONE company will ever dominate the entire market. no matter how many commercials they run   

    0Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    10y

    @Lamar Tisdale ? Shady? Look at the number of frauds claiming they buy houses that never have any intention of closing, tie up properties, lie to sellers, want 60 day escape clauses,  etc.  There are lots of posts on BP where these frauds complain their "inspection time" is running out and they have found a buyer.  Those are the shady operators. Someone advertising that they will do what they say? Good for them? 

    5Reply
  • Rod Desinord
    OP
    Real Estate Agent · Pompano Beach, FL · Member since 2015 · 249 posts · 73 votes
    10y

    @Lamar Tisdale  @John Thedford good points both of you. I disagree with you though John on the no intentions of buying, they do, they just have no money lol. 

    0Reply
  • Rod Desinord
    OP
    Real Estate Agent · Pompano Beach, FL · Member since 2015 · 249 posts · 73 votes
    10y

    I am not a lender, I have  a Real Estate License 

    0Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    10y

    @Rod Desinord LOL! My post had a typo and I note you understood that. You can find lots of posts here on BP where the poster is running out of "inspection period" time and doesn't know what to do. That wouldn't happen if they had honest intentions rather than playing games. We had a contract on one recently...same game. Where are they learning a lot of this? BP.

    0Reply
  • Lamar Tisdale
    Investor and Agent · Fort Lauderdale, FL · Member since 2014 · 30 posts · 11 votes
    10y
    The lending inquiry was for John Thedford Not you Rod Desinord
    1Reply
  • Nick Harrington
    Investor · New Midway, MD · Member since 2015 · 36 posts · 20 votes
    10y

    @Rod Desinord are you kidding me? Intent to buy but no money? What kind of BS comment is that? Wholesalers like you who lie to sellers deserve to be called out. Wholesalers are the shady ones.

    1Reply
  • Lucas Machado
    Real Estate Investor · Sunny Isles Beach, FL · Member since 2013 · 788 posts · 333 votes
    10y
    Originally posted by @Nick Harrington:

    @Rod Desinord are you kidding me? Intent to buy but no money? What kind of BS comment is that? Wholesalers like you who lie to sellers deserve to be called out. Wholesalers are the shady ones.

    I hope you meant that wholesalers with no money or intent to buy are the shady ones...Not just wholesalers in general. Plenty of wholesalers out there with cash, or access to cash, who do intend to buy. 

    @Lamar Tisdale - I lend in South Florida. Will shoot you a message.

    2Reply
  • Lamar Tisdale
    Investor and Agent · Fort Lauderdale, FL · Member since 2014 · 30 posts · 11 votes
    10y

    Great Thanks @Lucas Machado

    0Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    10y

    Note: the state is going after unlicensed operators acting as brokers. If you have -0- equitable interest and are marketing a property, that is illegal brokering. We have a local guy facing 3 felonies for that exact scenario. The way to protect yourself is to put down what the state calls a reasonable deposit, escrow the funds, and not have 30 ways to break the contract with a 60 day inspection period. We had DBPR come speak at our REIA meet a couple months back, and they laid out what may or may not be acceptable to THEM. They make and enforce the rules whether we agree with them or not.

    2Reply
  • Bill Gulley
    Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    10y

    In any state, when you execute a purchase contract you must have the intent to purchase and the ability to do so, this is basic contract law, nothing to do with real estate license law. If you do not intend to purchase as stated in the contract then you are not acting in good faith nor are you expressing your true intentions which is lying, you contract is voidable. If you do intent to purchase, honestly and can show that you can do so but then change your mind, you can assign a contract. But, if you never buy and enter contracts that you always assign, the fraudulent dealing becomes obvious. :) 

    6Reply
  • Rod Desinord
    OP
    Real Estate Agent · Pompano Beach, FL · Member since 2015 · 249 posts · 73 votes
    10y

    I do remember when i first started in this business seeing a lot of so called Gurus push the fact that its ok not to have money you can get yourself out of the contract with your inspection clause. Its a strategy to be fair that a lot of webinars and classes push for those who are void of funds.

    0Reply
  • Wayne Brooks
    Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    10y

    @Rod Desinord Interesting. If you're not willing to name the co. here, do send me a PM?  I'd almost bet it's another wholesaler, calling out wholesalers.  Even homevestors here does more assigning/flipping than fix and flips

    1Reply
  • Rod Desinord
    OP
    Real Estate Agent · Pompano Beach, FL · Member since 2015 · 249 posts · 73 votes
    10y

    I dont remember the company honestly I would have just named it, I actually saw the commercial during the republican debate. @Wayne Brooks

    0Reply
  • Lesley Resnick
    Real Estate Agent · Jacksonville, FL · Member since 2015 · 1k+ posts · 1k+ votes
    10y

    Forgetting the legality for a minute, acting as a broker without a license.  The whole concept of wholesaling is bit on the questionable side.  I get grandma to sell me her house at a fire sale price to pay for grandpa's surgery and I resell it before I own it and make a few bucks.  With few exceptions it is a win / lose situation.  It is about finding someone at their worst moment and taking advantage of them.  I can appreciate a good deal, and it is a business but....  

    A flip is a value add, I find something in bad condition and make it desirable.  

    Buy and hold, providing a safe clean environment for people to live in at a profit.  

    1Reply
  • Rod Desinord
    OP
    Real Estate Agent · Pompano Beach, FL · Member since 2015 · 249 posts · 73 votes
    10y

    @Lesley Resnick I see your point, because what service is really being provided? Grandma got 40k when she could have gotten 80k if she knew better? 

    0Reply
  • Leland Barrow
    Investor · San Marcos, TX · Member since 2015 · 272 posts · 360 votes
    10y
    All it would take is one non profit that focuses on recouping home seller losses and the wholesaling system would collapse. These large players that use wholesalers with assignable contracts should be careful. Regulatory agencies will have no pity for what can easily be spun as predatory practices. Contracts that are entered into illegally or even with the perception of being illegal can be unwound or given compensation in court. The companies with the most risk are the bigger REI. Wholesalers do not have much in assets but the rehabber may. The problem with wholesaling is that it may not be a mutually beneficial transaction. Separating poor or ignorant people from large sums of equity or capital because of ignorance is hardly ethical. An ethical buyer runs the numbers based on the market and gives their best offer based on having enough meat on the bone to be profitable. Wholesalers on the other hand are looking to maximize on a persons ignorance to get as big of a discount as possible and acting as quasi broker. The sheer volume of wholesaling being done is going to attract regulation. Defending business practices in court that are discriminatory and predatory from design, marketing, and through assigning is not something I would want to do. But hey...to each their own. Most ethical REI know the difference between a REO property or educated owner and those that are uneducated. Sooner or later someone will go to jail and someone else will be paying a judgement on a house they sold four years ago. They will also blame the system for over regulating....
    0Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    10y

    @Leland Barrow @John Thedford 

    I got a call from a wholesaler in Charleston SC... a market that I am building infill in. He must have sent me a yellow letter and I do respond to about 1 out of 5 I get just out of sheer curiosity.. well he calls me.. gives me an address. I send my guy over .. its a deal.. I tell him I will buy it.. 190k.. put EM down.. then the fun begins.. they never ran title on it turns out its in foreclosure and the amount owed is 220k.. I then have my guy pull title and somehow they got the ( as you state ignorant seller) to sign a POA giving them the right to resell and sell them the home for 100k.. idiots did not realize the seller owned 220k.. So I says to the guy.. don't you think 90k is a little excessive for a wholesale double escrow fee.. just got a bunch of double talk.. Told him forget it.. sicked my agent on the seller.. POA said seller could cancel with notice.. we are having her do that then we will see if we can short sale it. I mean this is what goes on.. its crazy.. We see a lot of wholesaling though in the Orlando area I close on average 20 to 40 a year there for guys and many are through wholesalers but the fee's are reasonable 3 to 5k..

    I often thought of sending out my own yellow letter like the add that OP is talking about.   Hey you get a yellow letter let me tell you its all just BS the handwriting the person sending it ext. you want to sell your home to some one real call me  LOL. 

    Podcast Guest on Show #222
    JLH Capital Partners51 Review
    WebsiteView Page
    1Reply
  • Russ Scheider
    Flipper/Rehabber · Mount Pleasant, SC · Member since 2013 · 547 posts · 235 votes
    10y

    @Jay Hinrichs I am over here shaking my head. A few greedy, under-educated newbies can really give us a bad name.

    2Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    10y

    @Jay Hinrichs It goes on everyday. I bought one where the seller was offered 135K. He sold to me for 120K.  Talk is cheap.

    1Reply
  • Jason V.
    Investor · Rochester, NY · Member since 2016 · 477 posts · 426 votes
    10y

    Disclaimer: I'm NOT a wholesaler! Nor do I want to be one, so I'm glad there are guys hustling out there to find good deals. 

    That said, there are some seriously ignorant and shady characters out there, and wholesaling seems especially attractive to the get-rich-quickers. 

    BUT to call the whole industry suspect is like saying convenience stores are all suspect just because they charge twice as much as a grocery store for bread and milk. Remember: you're not paying any extra for the product - you're paying for the convenience. 

    I don't want to spend a thousand dollars a month or more on direct mailing and pay-per-click advertising and all the other things wholesalers do. And I really, really don't want to spend all day answering the phone (or dealing with paying someone to do only that) to get a couple of leads where I show up, get screamed at for making low offers, then drive home questioning my existence. I would much rather answer one call from a good, honest wholesaler I trust, who has good systems and multiple buyers in place, and knows what is and isn't a good deal. 

    Just think of wholesalers as another contractor - they're just freelance. 

    2Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    10y

    We had a guy (he doesn't call himself a wholesaler) buy one for 40K, do minor work, and resell for 115K recently. Total jerk that complained about the agency fees and wanted the agents to reduce their commissions. They love to bash agents on BP:) 
    @Lesley Resnick I agree. Everyone is entitled to a profit but where is the line between that and totally screwing someone? That is a question that is never (or can be answered) but...if it feels wrong, it probably is. Some people will never understand that sentence!

    1Reply
  • Ian WalshBusiness Member
    Lender · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
    10y

    There is always competition and there are always more deals than any one person could possibly do.

    0Reply
  • Bill Gulley
    Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    10y

    Might add, anyone know what conspiracy is? When one conspires with another in the commission of what is illegal or unethical dealing, when yo know you're buying from an unlicensed wholesaler, one who probably obtained a contract under questionable means, are you not conspiring to facilitate that transaction? I'd say you are! So stop doing that, buy from the owner, the wholesaler can't do diddly about it and they might learn something. I don't buy from non-owners, ever! :)  

    1Reply
  • Andy Hudgins
    Covington, GA · Member since 2015 · 99 posts · 33 votes
    10y

    @ said above "... a market that I am building infill in."

    Does this translate to :

    putting together a new local team in a new market, or:

    building inventory? 

    Or both?

    What does that mean and thanks for your time.

    Andy

    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free