20 Yr. Old Investor: Got My First House Under Contract! What now?

Wholesaling
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20 Yr. Old Investor: Got My First House Under Contract! What now?

Account Closed
Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes

Hello BP!!!! I have waiting for this day and it has finally come. I have got my first wholesale deal underway and I have got a house under contract!! I am excited but anxious at the same time as I do not know where to go from here. It is BiggerPockets which got me interested in real estate investing and taught me all the knowledge I know today. Now that I have finally reached this point I am curious to know what to do next. I know that finding a buyer can be easy or difficult depending on the deal. Although, I know that the deal I have lined up is certainly profitable for a cash buyer. I live in Santa Barbara, CA but the property I found is in Hobbs, New Mexico. It is a 3 bed, 2 bath, 3/4 acre lot, and it is estimated at 151k on zillow. After doing comps in the area that seemed to be accurate. It needs minor repairs (about 10k), so I am asking for 80k.

My question for you guys is, what should I do next and is my asking price too low/ too high? I do not know how to reach out to cash buyers in the New Mexico area, so I am stuck on what to do. I have the property under contract and it seems all I have to do know is find a solid cash buyer. Although, I do not know if I am missing a link/step. Any advice would be great!!! I am a college student so this deal will really help benefit me with pain for my schooling/ living. This community has taught me everything, now I need one more thing from you guys so I can actually close my first deal!!! Thanks!!!!!

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Account Closed
Real Estate Investor · Shelton, WA · Member since 2013 · 369 posts · 639 votes
9y

@Account Closed "What should I do next" Is probably a question you should've asked and had answered BEFORE you tied someone's property up with a contract. 

27Reply
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  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y

    @Account Closed the contract is real, my uncle is a real estate broker and I sent him the contract to verify I filed it correctly. Do you have any advice on what I was asking?

    2Reply
  • Les Leslie
    Real Estate Investor · Eureka, MO · Member since 2017 · 6 posts · 7 votes
    9y

    Hey Blake: Good job! Just for clarity, 80K gets the buyer clear title to the property that needs about 10K fixup and the ARV is 151K?

    2Reply
  • Account Closed
    Real Estate Investor · Shelton, WA · Member since 2013 · 369 posts · 639 votes
    9y

    @Account Closed "What should I do next" Is probably a question you should've asked and had answered BEFORE you tied someone's property up with a contract. 

    27Reply
  • Jose Flores
    Real Estate Investor · Buffalo, NY · Member since 2013 · 227 posts · 318 votes
    9y

    Hey @Account Closed congratulations on your first deal.  Here are some ideas to get it in front of some cash buyers.  First, post it on Craigslist.  Create mulitiple accounts to always keeps it on the first page and call For Rent ads on Craigslist and ask if they are interested in buying more houses.  Second,  call other wholesalers "WE BUY HOUSES SIGNS" and offer them $500 if they bring a cash buyer to the table. Third, call real estate agents and tell them the exact same thing you told the wholesalers.  Last, show up to any local public house auctions and let as many people there know you sell dirt cheap houses.  Good luck.  

    12Reply
  • Robert Foley
    Investor · Fruitland, NM · Member since 2015 · 11 posts · 12 votes
    9y

    sounds a lot like a wishful thinkers deal.  New Mexico oil patch country is a real gamblers paradise (I know I live there).  Now maybe you are being brief for the sake of brevity, but I have about 12 questions for you before I would ever think of buying.   Like

    Can you show me 10-20 comps of properties in similar condition?

    Can you show me 10-20 comps of 150 k ARV closed properties in Hobbs

    Is the property in the nice part of town or the rough part? There actually are better parts of Hobbs 

    Zillow is notoriously unreliable in all of New Mexico (very nearly worthless due to our strange disclosure laws).  Have you actually got comps from an actual Realtor?

    Just giving you an idea of what actual due diligence looks like , good luck!

    7Reply
  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    9y

    Lesson #1: Don't grab the tiger's tail until you know what to do with the other end.

    The DIY Landlord Book4.7247 Reviews
    WebsiteView Page
    12Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    9y

    Did you sign a contract to purchase the house? Are you able to close? Can you legally advertise the property if you don't own it? Do you have escape clauses? What happens if you don't close? How accurate is Zillow for values? What is fraud by inducement? 

    3Reply
  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y
    Yes exactly, I have recorded the data from comps and have it ready for a buyer
    0Reply
  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y
    Les Leslie
    1Reply
  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y
    Robert Foley I have recorded all of that and more I have the full home criteria.
    0Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    9y
    Originally posted by @Account Closed:

    @Account Closed "What should I do next" Is probably a question you should've asked and had answered BEFORE you tied someone's property up with a contract. 

     Exactly! 

    0Reply
  • Account Closed
    Wholesaler · Mansfield, TX · Member since 2015 · 216 posts · 146 votes
    9y
    Blake Dalessio My response is going to be more of a general response with a lot of assumptions. I'm going to assume the property truly is worth $ 151,000 and assume it really only needs the $10,000 in repairs. I'm going to assume all this is correct and if it's not my response won't apply. First thing to do, as Tom Krohl would say, is SLOW DOWN mentally and speed up physically. What I mean is mentally your probably all full of anxiety and scared and freaked out. I know cause I'm a wholesaler and I get that way on every single property I lock up. "What if I can't find a seller in time? What if , Whaf if, What if."... First relax mentally, but start taking action NOW physically. If this is your first deal don't worry to much about profit only just getting the deal done and getting your check. My first check was for $2,000. It wasn't a homerun but it made it real. As mentioned Craig's List. Claim the listing in Zillow, post an add on For Sale Buy Owners. If property is vacant buy some bandit signs and post them around property with something like "Must Sell For Cash" and your google voice number. Your not there so post an add on CL for someone else to do it for like $20 or $30 bucks for 10-20 signs which will cost u another $30-$40. If you have some money pull a listscource list with all sales within last six months for that area /zip code with 100% equity aka cash buyers and send them a quick yellow letter about deal to mailing address. Just a few thoughts. Good luck.
    9Reply
  • Stanley Parsley
    Investor · Chandler, AZ · Member since 2015 · 409 posts · 214 votes
    9y

    great job

    that's more than most do

    so you got it under contract-

    FSBO, Craigslist, newspaper, Facebook, any and all media you can use to get it sold

    every real estate agency near you

    time is of the essence or youll be in hot water

    if your not working on getting it sold right now then you may need to let this one go and set your self up a exit strategy before you get another one

    just sayin

    great job on getting out there and getting a contract!!

    enjoy

    3Reply
  • Eric Mitchell
    Long Beach, CA · Member since 2014 · 16 posts · 7 votes
    9y

    Great job! Hope it works out well for you.

    2Reply
  • Ray Harrell
    Investor · Chicago, IL · Member since 2016 · 1k+ posts · 930 votes
    9y

    I admire you for being a go getter and actually getting a deal. The reason I haven't is because I'm stuck on the "what to do next" part. Unfortunately there is no single source of information that guides one step by step as to what to do, even here in BiggerPockets. That is why you feel lost in what to do next, because people aren't willing to share information. Even the webcasts that you pay for don't really give you all the missing links.

    I would say you did the right thing by jumping in and working on it as you go! This will be the BEST learning experience for you. Next time, you will be able to share with someone what you did wrong, what you wished you had done differently, what worked well, etc.

    I think sometimes people close 100 deals and forget that they also had to start somewhere. They get impatient, and forget some of the small, but important things when explaining to someone else who is new in the industry.

    7Reply
  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y
    Robert S. Hey Robert thanks for the tips! I know what you mean when you say take action physically..... I'm going to market all day today and reach out to buyers. I will keep you updated on how this worked out
    1Reply
  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y
    Stanley Parsley thanks Stanley, I am determined to get this deal.... but if for some reason I can not get it to go through I have a weasel clause in the contract so my exit strategy is good. I think I'm going to call up some ads in Craigslist in the Hobbs New Mexico area and start there
    0Reply
  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y
    Eric Mitchell thanks Eric!
    1Reply
  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y
    Ray Harrell I'm right there with you Ray! It definitely will be a learning experience but you know what they say, hands on learning is the best learning...... If I am consistent I think I will get this deal to go through! I'll keep you posted!
    1Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    9y
    Originally posted by @Account Closed:

    Stanley Parsley thanks Stanley, I am determined to get this deal.... but if for some reason I can not get it to go through I have a weasel clause in the contract so my exit strategy is good. I think I'm going to call up some ads in Craigslist in the Hobbs New Mexico area and start there

     And people wonder why I frequently use the term scammer! I feel sorry for the owner that thinks his house is sold.

    8Reply
  • Account Closed
    Business Owner · Madison, WI · Member since 2017 · 79 posts · 59 votes
    9y

    The people on here are vicious but they do have a point. You definitely want to have an exit strategy before you lock up a property or just use an option contract. Either way, good job taking action and practice full disclosure to all parties involved.  

    1Reply
  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y
    John Thedford your negativity is doing nothing to me self esteem, nor is it providing any constructive advice so if you have nothing helpful to say then please, fall back. I am actually now in the process of speaking with two potential buyers.
    6Reply
  • Account Closed
    OP
    Specialist · Hollywood, CA · Member since 2016 · 81 posts · 59 votes
    9y
    Lakeem Anore thanks Lakeem, I have an exit strategy in place.... Also you are right, this site seems to have changed since the last time I used it. Found a lot of helpful people when I was just beginning looking for advice. Now that I am actually about to make some profits it seems as if they have gotten a bitter attitude towards my success.
    5Reply
  • Account Closed
    Business Owner · Madison, WI · Member since 2017 · 79 posts · 59 votes
    9y

    Like I always say, if there was no money involved no one be quoting laws off of wikipedia on here all the time. 

    3Reply
  • John Thedford
    Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    9y

    @Account Closed

    This is a public forum. By your own admission you entered into this deal using fraud by inducement as well as deceit. What would you expect someone to say? Good job? I don't think so!

    5Reply
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