How to vet a deal when buying wholesale.

7 Replies

Dear BiggerPockets community,

I am planing to buy a property from a wholesaler I met at the REI meet up. I never buy from a wholesaler before. My experience is to by from a real estate agent. My question is how do I do my due diligent when buying from a wholesaler? Can I use my real estate agent to help me with the process? What do I need to look for? What can I do to prevent my self from unforeseen surprises? I would love to hear from experienced investors who have done this before. Any insights are much appreciated.

@Yuttana Chawengsub If you have an agent that is an investor you're normal process would be to run a comp report in RPR and Core Logic...pull historic MLS records, review auditor data...and essentially any other data to assemble a clear picture of the property...then we start to talk through analysis...based on investor need of course....pretty simple stuff, generally.

What type of property are you looking at? residential?...that makes things a bit easier....

@Brandon Sturgill Thank you for your advice. I am planing to buy a single family house. I live in Topeka KS. I do my own analysis using BPs calculator. When I bought from MLS, I had my agent helped me with property walkthrough, offer, contact, title clearance, etc. Those process gave me a piece of mind. I never buy from a wholesaler before, so I just want to make sure that I do not miss any additional thing I need to pay attention to. Thanks again.

Verify the numbers. They are often inflated ARV and underestimated rehab costs. Beware the non-refundable fees some try and charge though that is not an industry norm.

@Yuttana Chawengsub A real estate transaction is the same in Topeka as it is on the moon...the point being there is no real difference dealing with a wholesaler than you went through with your last transaction...fundamentally, anyway. 1. contract, 2. clear title 3. close

There are a couple nuances to think on like the title search and title insurance....let me know if you want to talk through these things...