questions to ask owners about their properties for wholesaling??

Question

hi.

i might be the fresh out of the sea beginner on BP, but i must say i'm amazed with the amount of info i've sunk in in the last couple of weeks. I also believe there's no faster learning process then give in it shot (let's reduce the legal cost :-)!!

i'm looking to start off wholesaling, i figured to build a network of RE attorneys for double closing, have contracts ready, contact investors to know their needs, which i've been doing the last couple days.

Now i'm ready to look for deal and tackle the convo with potential sellers:

1. should i completely avoid dealing with properties that already have an agent representing them?

2. i figure i can offer to work with a wholesaler if i come across thats already being marketed by a wholesaler?

3. Now the main issue: Owners. picking up the phone to call them, what do I need to ask them? should i negotiate on their advertised price?the reason for that question is as i will display my field of work i think i shouldn't negotiate unless i intend to buy, or i can ask there bottom price? do i always need to visit the property? if the property needs work, i have to evaluate the amount of work myself (inspection fees?) before taking it to investors?

4. to really push myself to work harder, instead of tying the owner to an assignment contract for 20+ days without any intent to purchase myself, i would like to lower it to 1-2weeks is that doable (visits, inspection, closing, ext)?

im in the New York metro area by the way..... don't mind my ignorance of the details of dealing with owners :-).

Micah Copeland · Answer

1. No. However, I do not deal with it if its listed. I have dealt with realtors who are helping sell a friends property and such.

2. Its referred to as Daisy Chaining. Many wholesalers Daisy Chain and a lot of them only do deals from Daisy Chaining... meaning they do no real marketing themselves. Yes you can do this, but I wouldn't recommend marking up the current wholesalers price and blasting it back out. It doesn't look too good for a buyer if he sees the same property with two different prices.... it scream amateurs. Ask the wholesaler who got the property under contract how much can he throw your way if you move it at that price.

3. Don't overthink it when it comes to sellers. Just let them know that you would really like to buy their house if y'all can agree on a price. I ask questions such as...

- Is the house listed?

- Is it paid off?

- Is it currently rented? If so, for how much?

- What type of repairs does it need?

- If you were buying it what would you fix on it or change?

- Whats the lowest you will take and still be happy?

So on and so on but you get the gist. Just ask a bunch of questions until you got a good mental picture of the property. I usually won't go visit a property until we get close to a price, or if its just a very weird property that I feel I need to go see to understand the value. I have also done deals that I never even seen the property.

4. I try and get as much time as possible in my contracts, but tend to get 45 days on average. Its easier to move that way. Yes I do have cash buyers that can truly close in 2 weeks, but most would rather not tie their cash up and would rather get the property financed and only have to put down 20 to 30% instead of 100%.

Hope that helps and feel free to reach out to me if you have any questions.

Micah Copeland · Answer

I don't quite understand everything you're asking or saying. However, I do let all my sellers know that I sometimes choose to pass deals off to other investors I work with, but... I also follow it up with something like "Don't worry though, in a case where I pass it off to another investor they will pay my fee and you will still collect every penny we agreed upon." As far as getting things under contract for 45 days and then not being able to close its simple.. Don't get anything under contract you don't think you can close.

Malick Guindo · Answer

@Micah Copeland thanks for the response, very informative.

on the other hand even though i understand the concept of business, i still try values and morals with it and i wouldn't be comfortable telling a seller to sit and wait 45 days on a contract which states that after the time runs out i will be obligated to purchase the property without any initial intent or capabilities to purchase it. i can have a lucky run all the time find a buyer, but did you ever display your intent to a seller ? what was their reactions? did you have to modify your contract?

questions to ask owners about their properties for wholesaling??

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