Hello BP family, I hope all is going well with everyone. The reason for my posting this evening is to state my current situation and see if anyone could give me some words of wisdom and/or direction so that I can proceed in a positive direction. First, let me say that I am very new to real estate investing, only having gotten my first deal a few months ago this year. As I am trying to grow my company, I have set wholesaling as one of my investing strategies to build my cash reserves so that I can also flip properties in the Chicagoland area. The situation is this: I met another wholesaler recently at a networking event who showed me some properties that she had under contract. I seen one that was in my main area of focus and I knew that I may have had a buyer for that particular property. As I am lining up the buyer with the details of the property, I posed the question to the wholesaler, which was regarding the amount they would be willing to pay me if I brought a legitimate buyer to the table who was able to close? They mentioned that they would pay me a couple hundred dollars, but if I put it under contract with her and assigned it to my buyer I know could do at least a couple thousand and there still be plenty of room left for the investor purchasing the property. What I wanted to ask you all is: 1) How can this deal be structured if a wholesaler finds another wholesaler's property-that they already have under contract with a seller, and find a buyer that is willing to purchase it? 2) What contract will be used? 3) Do you have to take the referral fee, or is the scenario I'm posing legitimate? I have done a lot of research on the wholesaling strategy, but obviously there are still many areas where I can always learn more about. Like I said previously, I am a new investor, but I'm very hungry to push forward with my goals of learning this business and being successful in it, and I just want to stay active and not become one of the stagnant individuals on the sideline watching. Once I got the first deal out of the way I am very anxious now to keep pressing forward. Any useful information that can be provided will be greatly appreciated. Thanks in advance BP family.
Well you are a newbie and have to learn more knowledge and I say do not sell yourself toooooo short. Now the other wholesaler has the property under contract and you are the person bringing the biggest meat to the table. You should not settle for a couple hundred dollars, at least you can negotiate a larger amount. You are establishing yourself as a brand and your word and work ethic are your bonds.
If she doesn't want to be fair and wants all the money then pass on the relationship. You have ti have healthy business relationships that are fair and will have longevity. If it is going bad in the beginning, it is a trigger for you to move on and find your own motivated sellers. YOU CAN DO IT. Feel your gut and go with it:)
It is not legal to collect finders fee, you are infinging on the territory of a Liscenced RE Agent. The only legal way to do what you are doing write now is a JV agreement. Your name goes on contract. Doesn't sound like they want to do that. The Government helps to protect the Realtor/ broker territory. Small amount they probably won't bother you, but then what do you put on your tax return? Don't call it a finders fee.
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