What is the next step

Question

Ok, so a newbie question here.

Scenario, I marketed for sellers, got a seller, put property under contract

What are my next steps?  I've been doing research but keep getting stuck here.  What are the next steps.

Thank you.

David Bokman · Answer

I'm not even sure what the question is here? If you have a house under contract and you don't know what the next step is than I would suggest re-evaluating what you are doing and your plan. Do you know if this house is a good "deal"? Did you crunch any of the numbers? ARV? Estimated repair cost? Recent comps in the area? Run title search? It seems to me that you need a lot more education and experience with trying to wholesale a property. It's NOT as easy as everyone makes it out to be if you don't understand what you are doing and how to calculate the numbers.

But if you have a house under contract the next logical step would be to market and sell the property. Not really sure what you are getting "stuck" on????

Sean Edgar · Answer

Hi Douglas. The next step would be to market the deal to your buyers list. Building a solid buyers list is a critical part of wholesaling. Sounds like you have not started on that yet but you should right away.

The most common buyers for wholesale deals are Rehabbers (fix and flippers) and landlord buyers (buy and holders). You can find these investors in many ways but here are a few for you:

• REIA's- Real estate investing association meetings
• Courthouse Auctions
• MLS- search for cash transactions or have an agent do that for you
• Bigger Pockets- search for Rehabbers and buy and holders 
• Google Search in your area for the "I buy Guys". Search for "we buy houses" followed by your city name. Can also search for "I buy houses", "cash for your house", etc.

Once you have a buyer for your deal, you will assign the contract to them for your fee. When working with a buyer for the first time you may want to collect a non refundable deposit for a portion of your fee. This should be done at the time the contract is signed. The non refundable deposit is optional.

Next escrow is opened up. Send the contracts between you and the seller and you and the end buyer to escrow company. You will be cut a check or wired your fee when the deal closes.

This is a broad overview to help. If you have any very specific questions, let me know.

This process is a little different and more technical if you are dealing with bank owned properties though.

Here's to your success!

Jacobe Kendrick · Answer

Douglas,

You need to know the numbers on your deal.  Gathering these details will also help you with future deals.  What is the subject property worth right now in its present condition?  What is the property worth after it has been renovated (ARV)? You also need to know approximately what the repair cost are going to be in order to get the property to the ARV.  I would not market the property until you have these numbers unless you are positive that you have the property under contract at such a discount that the numbers don't matter.

Great job on moving forward on a deal.  That is the first step.

Douglas Escalante · Answer

Thank you all for the feedback.

Im still educating myself, sorry if my question misled anyone into thinking i already had a deal under contract. I want to make sure i fully understand our business before i jump in.

So next step is to find your buyer, assign the contract, i like the idea of getting a non- refundable deposit at assigning contract, then take all contracts and assignment to escrow.

That raises another question

Again please excuse my ignorance

But how is the earnest money handled on the purchase contract and the assignment contract? If i put an amount on my purchase contract, do i put that same number on the assignment contract, so the buyer is responsible for it?

Muhammad Saleem · Answer

hi Sean,

Thank you. I'm also currently working on my buyers list. Just have 2 so far.

You suggestions 'll be highly appreciated.  I'm waiting for my membership to get MLS access.

What is the next step

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