Happy Monday BP!
I come here humbly saying that I'm not sure of the next move. 12 months ago almost to the day my dad and were very blessed with some great guidance and advice and jumped into the real estate world not knowing a THING about it.
2015 has been fantastic! We picked things up fairly quickly, mainly by making several crucial mistakes costing a good chunk of cash and probably annoying my mentors with several hundred questions. In July of 2015 we closed our 9th deal (7 wholesale deals, 1 referral, and 1 land investment).
The problem is I feel sometimes this feels more like a hobby then a business. My dad and I have also been very blessed with great careers that have allowed us to not only fund our initial efforts but that also allowed us the time off needed to run the business. But it's time to take this to the next level! Quit the day job next level. Spend more time with my wife next level.
Funding is a major issue for our growth. I'm putting together a portfolio of our 2015 deals and noticed on several deals that if we would have flipped the property rather than wholesaled it we would have made more money even after splitting the profits with an equity partner but we don't have that option due to lack of networking (our bad for sure) and funding.
Sorry for the long post here but I wanted to be as detailed as possible. I come here asking how do I take this to the next level? How do legally ask for other peoples money without sounding like the next episode of American Greed?
Thanks in advance,
(This site is awesome btw!)
I coach wholesalers scale their wholesaling business by using their same marketing dollars and doing more with those dollars
There are deals out there but you throw the leads away
For instance let's say you had a light rehab and 100,000 needed 5000 work
70% of the hundred thousand 70, subtract 5000 for the work, and subtract 5000 for the Wholesaling fee and you left with 60
You can JV with that particular home seller and use your money to fix it up; you figure out the closing costs and sales costs, get private lender money and pay the interest, fix it and resell, you pay the homeowner when it resells, no payments to the homeowner until it sells
Say it costs 10% to sell, 5000 in work, 10,000 in a JV fee, net to the seller on the joint venture is 75k, better than the Wholesaling offer
For houses that have no equity but they're pretty and don't need work, are in good areas and have good schools and low crime, you can buy on subject to, buy on a wraparound mortgage, or do a lease with option and then assign the deal. These deals can create 3 to 5% value in assignment fee relatively quickly like 10 hours
Free and clear houses that have no mortgages, have opportunities for creative finance too
You could buy the house and give a payment that is low enough for cash flow with market rent
You could have a homeowner get a 50% mortgage for cash now and then get some cash later with a private second mortgage
The negotiation with the seller on terms deals is completely different than pushing the price down like car dealer in wholesaling, it's not apples and oranges, it's grapes and watermelons
Being a one trick pony doing "only wholesaling" with all the competition you have I think is crazy
I get a ton of my pretty house terms deals from wholesalers that only know how to wholesale
Thanks Brian...that is some interesting stuff. Little confusing but interesting. You mind if I give you a shout later and discuss more?
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