How can I get around one agent that doesn't work with wholesalers to another that does? This house is a 40,000 profit and dont want to lose it. My other friend is a realetor he said he would work with me. Please help
Your question needs more info posted. Is the property listed with the first agent? If you make an offer most likely the agent is obligated to present it to the seller regardless of the type of deal/buyer/financing.
@Lynne Garris - unfortunately you can never get around the listing agent. They have a contract on the house already.
You don't have to work with any particular buyers agent unless you sign an exclusive buyers agent contract. If you signed one of those, then you're technically stuck with them (but everything is only as binding as the involved parties willingness to enforce the contract)
Almost no listing agent is going to knowingly work with a wholesaler. It’s not in their seller’s best interest to let a wholesaler tie the property up hoping they can flip the contract. If the property is a good deal, it’s already been exposed to the whole market at that price. Do you think there is a $40k profit at the list price, or just at some much lower price you want to offer?
I agree - if it had that much money to be made then someone would buy it. Also why would they go through a wholesaler when it’s on the market?
@George Patrick okay I went with my friend hes a realetor to see a foreclosed house, did my homework, comps, etc. Got a estimate knew it was a good deal. Made a offer of 25,000 it was accepted, estimate was 24,600. Than the realetor said they cant accept my wholesaling contract. It's a 40,000 assignment fee by the way for me. What can I do now?
@George Patrick also the seller is a mortgage company which I have been calling for weeks, direct mail, emailing. What can I do now to reach them? All I need is for them to sign my purchase agreement.
@Michael Ablan Okay that was to be my first deal I didnt know. Now I do. I started and made a offer in just few days. I was excited, so when I took my purchase agreement for them to sign than they said we have our own contract instead.
@Mike Morawski Thank you for your input. I did he than told me there was another realetor involve and he had the top say in that deal. Which he than said we have our on contract that they use. So I've been persistent in weeks of contacting the mortgage company.
@Wayne Brooks Yes my mentor told me this is a great deal. 25,000 to buy, 25,000 to repair, comp is at 174,000 in that area which is a nice area. I want this deal. So I have been persistent still no return call, or email or anything.
@Chris Seveney Yes correct and it's been sitting there for a while. If I had the 50,000 I would purchase it and fix it up, sell it. Than I could walk away with more than 80,000 profit.
@George Patrick I did make a offer and was accepted. Than the day he was to sign my purchase agreement he said I dont know about wholesaling than told me there was another realetor involved. So than I spoke to him and he said he uses only his contract.
@Lynne Garris This doesn't seem right. There has to be more to this story.
It seems highly unlikely that a property listed on MLS will leave that much profit sitting on the table. So the first thing to do is to double check and then triple check your numbers. Pay special attention to the rehab budget and ARV. Don't forget to look at outstanding liens, zoning violations, boundary disputes, wetland encroachments, etc.
If there really is that much profit in the rehab and resale, my bet is that rehabbers would snap that up with an all-cash purchase on the same day it hit MLS.
The next issue is the Realtor. The listing agent will have a contract with the seller that gives him an exclusive right to sell. No matter where a buyer comes from, the seller is obligated to pay the full commission. There's no "going around" the listing agent until the listing has expired or has been canceled.
The reason the listing agent doesn't want to work with you is that:
a) It's not in the seller's best interest and don't forget, the listing agent is a fiduciary to the seller. You'll want to tie up the property while you find an end buyer and have no intention of actually closing. Further, as an investor, you have to buy at a steep discount, which means that the seller gets less than true market value.
b) Unlicensed wholesaling is illegal in most (and I believe almost all) states. A licensed Realtor has to stay far away from illegal transactions or risk fines or license suspension. Wholesaling almost invariably takes advantage of a seller who is distressed or uneducated.
In my opinion, the smart move is to invest in getting your real estate license. Then you can operate above board.
"How can I get around one agent that doesn't work with wholesalers to another that does?"
What exactly did the listing agent tell you? That he wants to work with the actual person buying it instead of someone that'll tie it up and then walk it around and hope they can put a deal together and then skim a fee?
Maybe the listing agent has the seller's best interests at heart.
@Lynne Garris You’re going to get no where with this...
1) as @Charlie MacPherson mentioned, your numbers/analysis are off. No property in any market would be sitting there if you could buy for $25k, Reno for $25k, sell for over $150k...there are many local rehabbers with cash, it’d be gone the first morning.
Some other basics you Should know....
2) agents can Only use the state realtor approved purchase contracts, period. With an REO, there are additional REO addendums, 4-6 pages, modifying the state contract
3) the bank/owner of an REO will/van Never deal with you direct, whether the property is listed or not, especially when it is listed.
4) an REO will Never accept your offer without a Legit POF in Your name if you are the buyer on the contract
5) REO contracts are Never assignable
If you don’t know these things you are just spinning your wheels and wasting everyone’s time
If you dont have money to close yourself don't offer on the property it's a waste of the seller/realtors time and a good way to get blacklisted. FYI if it really had a 40k margin would of been multiple offers over ask immediately day it hit market.
@Lynne Garris start a new LLC and get the house under contract in the name of the LLC. Sell your position in the LLC for a $40k fee.
If you happen to live in Louisiana any Real estate contract is assignable.
Alternatively You may be able to sign your name on the contract as “John Doe and his/her assigns”
@Simon S Marthinsen Just so you know, any REO will have purchase contract addendums making the contract non assignable....it's in their addendum package that goes along with your state contract. You'd still have the issue of needing a POF in the buyer's name on the purchase contract.
@Mike Morawski I'm not sure. You would just think they would be anxious to get rid of this burden. I look at it like this. The property is sitting there , the realetor isnt making anything so why not sign my contract. They accepted it already.
@Charlie MacPherson the property is in foreclosure and a mortgage company owns and I have been trying weeks sending them my interest though phone calls, text, emails, postcards, and faxes. That's the issue I guess.
@Steve Morris the agent told me I dont know what wholesaling is? So explained it to him. Than he says I have another realetor involved you will need to call him. So I did than he said we have our own contracts.
@Wayne Brooks actually I an brand new I know now never deal with a realetor unless I have all cash. Actually they wasted my time. When ever I wanted a appointment they always say next week...they dont even work weekends omg. Waste of my time. Lesson learned..
@Henry Lazerow what is blacklisted? Remember I am brand new I really didnt know.