I find, you buy?

Question

I'm a 21 year old MBA candidate, I have extensive knowledge in the westchester area in NY as well as long island. I scout home prices and neighborhoods daily as a hobby of mine. I often find extremely good value homes, with enormous potential to either rent or buy.

I'm looking to work with investors. I'd like to establish a relationship with some of you guys. It's simple, I find the houses, you buy them, and then you can do anything you want with the contract after you buy the home.

Looking forward to hear some of your replies!

Thanks,

Michael

Chris Boyd · Answer

Why don't you tell us @chinmay J?

I'm certain that if he has a deal, there will always be a buyer. That's been our experience at least...

Chinmay J. · Answer

Account Closed - Here is the thing.... A lot of people (like those on this thread) will sell you the rosiest pictures about wholeselling. Wholeselling is basically you getting in a contract with a motivated seller, and then assigning the contract to another motivated buyer who can close the deal in X number of days.

Now remember. Whenever you do a real estate transaction of any kind, you are required to put down what is called an EMD (Earnest Money Deposit).  Regardless of whether you are an actual buyer or a wholeseller, you will be putting this down. You are at risk of losing this money if you are unable to close the deal.   Some people have said that they were able to put down $1 or $10 as EMD for a wholesale deal.  Trust me, when I am a seller I wouldn't let someone have that little financial interest in the deal. If you can find such sellers in your neighborhood/target area, by all means go ahead. Also, as a wholeseller, you will need a list of motivated buyers.

If all you are looking for is to research the houses and present them to us/me, We/I, don't need you for it. That's what realtors do for us. A lot of investors like myself, are realtors too. I can research properties myself. Now if you can find some off market properties for me and just hand over to me, what incentive do you have for yourself without any binding agreement between you and the seller or you and the buyer to get you paid? You do that, and you just volunteered your time and got nothing in return.

Here would be my advice. Educate yourself.. Start saving.. Perhaps get your real estate license and get access to MLS and potential buyers and sellers. J Scott who has written a great book on flipping highly encourages that you get your RE License.  The book is only $30, and perhaps the best investment I've made so far. Down the road you can try house hacking (where you buy say a duplex, live in half and rent out the other half.) Of course, when you have a little capital, you can consider wholesaling.

Justin Howe · Answer

Hi Account Closed starting as a bird dog is a great way to get your feet wet in REI. Try posting to craigslist with a similar message. You might find opportunity there too.

Account Closed · Answer

@Chinmay J. Thank you for your kind and informative response. I understand people try to sell dreams and don't face reality.

"If all you are looking for is to research the houses and present them to us/me, We/I, don't need you for it."

That was what I was planning on doing. It doesn't hurt if I find out about a property (off market) that has little exposure. I was just wondering if any real estate broker/agents or investors would utilize me to find them undervalued investments.

Also I would be compensated by trust. No contract, nothing at all. If I show you a property I'd trust you to pay me the ex. $3,000 for finding you it.

It's hard to wholesale @Chris Boyd when I have less than $10,000 capital and have not been part of a deal, no? What I am suggesting is something to get my feet wet, find someone a property, watch the contract process, and analyze how they then handle the property.

Account Closed · Answer

Thanks for the replies guys. I can't wholesale because I have no capital. My role would be to research the houses within a specialty area and then present them to you.

If you end up buying the house, I'd receive a very small commission.

Does this exist? Thanks.

Matthew Augustine · Answer

While I agree that banking on trust is a risky proposition, I don't see anything necessarily wrong with your logic. A lot of deals, especially off market "verbal" agreements are based at least in part on trust.

I'm an aspiring buy and hold investor that really just started my market research, and have been educating myself for the past year as I built capital and minimized monthly obligations. I'm also from NY (although not necessarily focusing efforts there) and while i'd be more then willing to compensate someone for "bringing me a deal" i'm wondering (like others here) what your scouting and market research would reveal that mine wouldn't. Now, if you sat down with off market / distressed owners, and negotiated an excellent value and then presented it to a buyer, that would be different - but just locating a property or a building doesn't really bring much to the table, and the barrier to entry for such is as simple as owning a computer most times.

Mind you, I agree with your philosophy, I just don't know how effective it would be unless you're willing to bring a little more to the table.

Jake Hartnett · Answer

Learn more about wholesaling. $10,000 is plenty of money to start wholesaling and you will actually have deals under contract. Or like others have said, team up with a wholesaler and bird-dog.

Jeremiah Richter · Answer

@Michael Cardilicchia

When wholesaling Properties you will be finding motivated sellers and in that case they usually won't care about the earnest money deposit, that is really just the purchase of the contract and is kept by your agent.  If the deal falls through you should have a clause in your contract that will allow you to back out within x amount of days (ex. didn't meet requirements in your inspection).  Since you will be assigning the contract, you are not purchasing the house, the new buyer is.  You should however verify that they do have the funds to purchase.

Once you assign the contract you have no obligation to do anything more with the property, it is now between the seller, your title company and the new buyer.  Your assignment fee will be held by the title company until closing, unless otherwise arranged.

Any money spent on your part will be marketing and earnest money deposit which shouldn't be much since you found a Highly Motivate seller.  If you run your numbers right and really have a great deal, finding a buyer is quick and easy.

Chinmay J. · Answer

You can consider working for an investor as a bird dog as someone has suggested in the thread. He can give you a finders fee. Small amount.

Also, I would never work on just trust. If you have intentions to pay me, you shouldn't have problem putting it in writing.

I find, you buy?

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