Wholesaling Help

20 Replies

I may be asking for to much but,I need someone who can and will help me to learn how to do HUD deals.
A bit about me. I am a 70 year old widow living on SS. I do not have good credit and I do not have any money. I desperately need to make extra money. I do have experience in buying and selling mobile homes and parks. I learn quickly. I do have a bad back so can't do to much walking (ie,inspecting properties) So,if theres anyone that would like to help me just give me a shout. It would be best if I could do most everything from my computer and phone. Thank you ahead of time. Doni

Guess I forgot to mention I live in NW Atlanta GA area

What sort of help is it you're looking for? If you're actually looking for deals, or someone to partner with, please post in the Marketplace forum.

Bad credit and no cash is going to make buying a HUD difficult. There's no possibility of owner financing. Conventional financing is going to require a significant down payment, typically 20% these days. And you will need good credit and income to qualify for the loan. The real kicker is that financed rentals don't generate much cash. A few hundred a month would good for a rental.

@Jon Holdman I'm in the same boat here...I'm confused with the mention of buying HUD properties and mobile home investing. There are mobile homes that are on land and are in foreclosure, but the "mobile home investing" model usually (or for most strategies) does not take place with these types of properties.

@Doni Healy You can do a lot from your computer, though you'll need some ground work.

It is a common practice in mobile home investing to recruit people in the parks...and let me back up. There are ways to make money on the HUD (mobile home) foreclosures, however in your position your best bet will be to work on something you can either option or get seller financing. With that out of the way, you'll need to introduce yourself to parks/managers/owners and let them know you're in the business. Once through that, you can start a relationship with any of the following to help you work. You can pay each or one a fee to get things done for you. Most you can negotiate that you'll pay them that fee ONLY if you sell the home in question. So that way you only have to pay them if you get paid. I'll list what I used to pay for and how much, and then who might have done that work for me as an example; and remember, these are examples and "industry" averages. I've negotiated a lot of these, and always you can to:

1. Pictures and Video of the home: $100-$150. Takes them 15 minutes to do it. You need at least 4 pics of the outside and about a 2 to 4 minute video walking through the inside. This is for your advertising so you can sell the home.
2. Someone to show the property. I tried using lock boxes and they got stolen before I could blink...or broken. I've hidden keys before and used a rigorous screening to allow folks to let themselves in the home but that was a risk waiting to happen. I never got burned, but as soon as I could afford to I hired to show the property. To show and "sell" the property for you would be in the ballpark of $150 to $300. Again, you'll need a lot of showings in some cases before it sells, so negotiate that you pay that TOTAL for the home, for unlimited showings, and so you won't have to pay unless the home sells...INCENTIVE!
3. You may or may not need the home cleaned. I have a cleaning crew and pay in the ballpark of $150 per home.
4. Contractors to fix it up: If major things need repair (usually the first 4 or 5 buyers that DON'T buy will tell you for example, "I would buy that place if you fixed that couch sized hole in the floor, shampoo the carpet and replace the door to the bedroom that was kicked in...". Obviously, you get the point. Work on your feedback. Pay the contractor after the home sells. In this scenario you will need to pay them if it sells or not, so be careful in dealing with fix up depending on your method of purchase. If you just have an option be careful fixing the home as you'll have to give it back if you can't sell/pay for the home.

There are other things, but for the sake of time, here are some folks (and I've used them all) that can help:
1. Park Maintenance person - will usually work on the "side".
2. Small one man contractors. You will be approached by everyone and their brother that can do work once you get your name out there.
3. The first person I sold a home to became my catch all contractor. She cleaned and did other contracting for me. So use what you have at your disposal...it could be buyer's that can help.
4. Sellers also. I've bought homes from folks that worked on homes, and had them come back and do work on other homes for me.
5. Contact movers and see if they can do other work than just moving it. My furnace guy is the son of a mover I used one time.

You'll need to really arm yourself with the education and processes of the business before you jump in. I'm all for jumping into something and not getting "paralysis by analysis", but at the same time don't go in blind.

I don't know of too many educational resources, but @John Fedro has very good knowledge of the business and so do the websites that pop up when you google "mobile home investing".

Once you get your homes, the big part of the process will be marketing and selling the home. That's another business in itself and post in itself! Check out what others are doing and see what you can learn.

Best of luck!

I guess I didn't make myself very clear. I need to make some extra money NOW.
And how come I keep hearing you can buy hud homes,commercial properties and any kind of homes with NO money and NO credit? I don't get it.
I want to flip some properties and I know about mobile homes and parks have lots of experience in that.
I'm confused

The kind of help I need Jon is partner,or someone to show me how to flip with no money down and no credit. I hear about it all the time.
So,how do I do that? I don't want to hold properties.

Looks like you'd like to get into wholesaling. In short:

1. Find a property that is a good deal.
2. Lock it up in a contract (option) for as long as possible.
3. Sell (assign) your contract to another interested party for more than your contract purchase price.

There are LOTS of wholesalers out there, and you can find many that blog on here. There are probably MANY in the Atlanta area and you can start by meeting them, asking what they could use for help and partnering with them. I'm almost certain MOST would be happy to pay you a fee for seller leads they close.

It's hard to wholesale HUD properties though can be done. You'll have a small window of time to sell the property and to get the type of deal you need; it'll be a numbers game for you making as many low offers as possible. To do HUD contract flips you'll need a little cash to tie up the property and you'll need places to send those deals quickly. I don't know how long you can lock them up but doubt you get it for longer than 45 days...probably more like 30 to 45. I may be wrong but you'll probably need proof of funds. I'm a realtor but don't do much work with that. Other investors would be able to tell you more.

Hope that helps.

P.S. I would go to as many local real estate investor meetings as possible and meet all the wholesalers and investors in your area. Ask them how you can help them. You'll find buyers there and you'll find other wholesalers that may need help making offers. I know a guy in my area that did that and teamed up with a big investor. His job is now to make offers on the computer all day - he got himself hired and is making good money doing it.

ok Sam. How do I find these meetings? Thanks for your help. Anybody else have any comments/ Any help?

@Doni Healy , I'm going to be honest with you. There's nothing you can do with either wholesaling (getting houses under contract then immediately reselling them to an investor) or doing fix and flips that will make you money right now. Both are time consuming processes. Both require some amount of cash. Wholesaling will require less, but you will still need to have some amount of cash to do marketing and find deals. Finding good deals is REALLY HARD! Most people have a pretty good idea what their property is worth and they want something close to it. A really good deal is one that's at a substantial discount to its current value. That means you have to do something to find those very few desperate sellers who are willing to sell at a substantial discount. They're out there, but it takes work to find them.

I do know a person who does wholesale HUD deals. Its a complex process. HUD (and many banks who sell their repossessed properties) puts restrictions in place specifically designed to prevent wholesaling.

Yes, there are lots of people out there who will say "I'm a wholesaler". I'd hazard a guess that 99% of them have never and will never do a wholesale deal. The ones that are successful put a lot of time and a significant amount money into this business.

It might be possible to do a fix and flip with little of your own cash. That typically involves using a "money partner". The money partner puts in all the money. The active partner (you) find the property, buy it (using their money), supervise the rehab and then get it sold. In other words, they put in all the money, you do all the work (though, usually with contractors, you don't need to swing a hammer) and then you split the profits 50/50. Doing that means you need to be able to actually run this project. And you need to find this money partner. That's a task in itself.

Finding someone who will lend you 100% of the money you need to do a fix and flip is almost impossible. Most of these lenders, "hard money lenders", want some of your cash in the deal. Even the ones that will possible lend you all the money you need have lending limits that mean you must have an incredibly good deal to get to 100%. Those deals are very rare. Even more rare than the ones that would make good wholesale deals.

Sorry. Real estate is good for building long term wealth, but just won't produce a quick and easy paycheck.

I'll repeat that posts seeking money, buyers, partners or lender must go into the Marketplace form. This forum is for discussion only.

@Jon Holdman I couldn't agree more with your last post.

The only thing I would add that if it is the intention to make cash the quickest way possible and it is decided that real estate is the means, wholesaling would be about the only option for the LEAST amount of cash invested (for the newbie - correct that no one is giving 100% funds to a green investor). And to add further, the investment if not cash is at least tons of time scouring for deals. You are 100% correct that deals don't just fall into your lap, it takes work and usually marketing cash to find them. About the only way to minimize would be to drive the outskirts of town looking for obvious foreclosures.

I think for the sake of the discussion here I would add that educating yourself with the business is the only way to decide if it can work for you.

@Doni Healy Only speaking from my own personal experience, I would attend all the REIA groups I could get to. There has to be tons in Atlanta. Meetup.com has local groups and you can google "real estate investor groups" or "associations" instead of "groups" in Atlanta.

Remember there is NO get rich quick. It all takes time, money, energy and tons of perseverance.

@Doni Healy no quick money, sorry just not how it works. You can do deals with no money and no credit, but they are few and far in between (least in my market) The biggest hurdle you face is learning the market in your area. What is a good deal and what is not, who are the buyers and what are they looking for in a deal. I am from ATL and last time I was there, their were a lot of big player in the wholesale market. Hard to compete with someone with 15 employees looking and big adv budgets. Plus to get the good deal you need some type of adv campaign. Which cost money I am sure you don't want or need to spend.

Call some of the "we buy houses signs" see if you can work as a property locator(bird-dog). Most of the smaller investor like myself love to have all the people we can looking for properties, and will even train someone on what we want and were. We also pay a fee to you if you bring a deal that works.

As to the REI meeting I am not so excited about them. Lost of newbies and sharks so be careful who you listen to. Good Luck, REI is a great business, you can make lots of money, but just like everything else, it is not get rich quick and no easy free lunch.

thank you Kerry. Yes,I am leaning in the direction of bird dogging. any tips?

Originally posted by @Doni Healy :
I guess I didn't make myself very clear. I need to make some extra money NOW.
And how come I keep hearing you can buy hud homes,commercial properties and any kind of homes with NO money and NO credit? I don't get it.

Doni, you keep hearing about it because there are a ton of people out there selling courses on how to get rich quick. Some things never change. But they are selling a pipe dream, separating people from their cash. If it were easy, don't you think everyone would be doing it? But the easier they make it sound, the more courses they sell.

Wholesaling is hard....really really hard. People who are successful at it make it look easy, because when everything goes right, from the time the call comes in to the day of closing I might put about 2 or 3 hours into making my 5k check. But it took years to get my systems set up and thousands of dollars to build my marketing machine. And I have to put money into that machine every single month or it stops working.

No one on here is trying to discourage you, but what you get from this thread is a good cross sampling of reality.

@Sam Parkins ,....good stuff man. Keep it coming!

Jerry: Thanks for your input. I appreciate it. At this time I don't think wholesaling is for me but bird dogging is. Any tips on that.

I'm not discouraged at all. Why be discouraged when facts are facts.they need to be heard also.
Hey,I'm 70 years old and been thru a lot in my life. This is just another bump in my road. Nothing I can't get across. Always willing to try new things. You know if you keep doing what you're doing,you'll keep gettin what your gettin.

@Jerry Puckett Thanks for the kudos, and great stuff all around from everyone! @R. Kerry Brooks @Jon Holdman

I am not the informational source on wholesaling/bird-dogging... There are probably (and have been mentioned) MANY big investors in your area and you should contact them to see what they can use. They'll give you a criteria and a plan of action to find the homes. Great point on calling the "we buy houses" signs and such. Look on Craigslist and see if you find multiple properties listed by the same investor. Google search to find investors in your area. If you googled in my area for mobile home investing it wouldn't be hard to find me and I would certainly line you up for bird dogging. Which is another excellent point, I have 1 or 2 bird-dogs looking for me and ALL real estate investors would be happy to pay for good property leads!

Maybe an investor in your area is running an ad in the paper for a seminar type deal where they would meet you on a weekend to explain the bird-dogging. Careful though as mentioned, there are a lot out there not doing what they say.

To close, many of the investors in your area should have a website. Just do as much due diligence as you can to find the "players" and then contact them to see if you can help.

Bird dogging and wholesaling are almost exactly the same thing. There are two differences.

With wholesaling, you actually get the property under contract. With bird-dogging, you stop when you have what seems to be a reasonable prospect. You pass the info onto the potential buyer and they close the deal. Your lack of a contract, though, means its easy for the buyer to go around you and cut you out completely.

The second is the money. Wholesaling might earn you a few percent of the value of the property. Yeah I know the gurus promise multi-tens of thousands of dollars paychecks. That might happen once it a while. Its not the norm. With bird-dogging you might make a tenth of that. So, while a wholesaler might make, say, $5000 on a $100K deal, a birddog might make $500.

So, smaller paychecks and much more risk of being cut out of the deal. But you still have to do essentially the same work to find buyers and sellers and hook them up. I can't see what prevents you from wholesaling if you think you could do bird dogging.

There are several threads in the wholesaling forum (where you posted this) that discuss finding both buyers and sellers. Those work just as well for bird dogging as for wholesaling.

I am truly disgusted with how many people are out there selling the pipe dream that you can make money quick and easy with wholesaling. And charging a big price for selling you that dream. Don't fall victim to these people.

Hi Doni,

It sounds like you have a great outlook on trying new things and working to make the best out of life. Your vision of real estate investments may have been a little misguided by "Easy Money Gurus" but now it seems like you have a better understanding of how you can provide real-value (within REI) to make yourself money.

I have one suggestion... It's not fast money, but it is cheap.

After you be friend and exchange phone numbers with a few active cash-buyers in your area you can start looking for motivated sellers. You already likely know many home-owners in and around where you live. Be a little nosy and start asking around if anyone knows of anyone that may need to sell quickly?? Start walking (as much as possible) and talking to your neighbors daily.

Being a good bird-dog does not necessarily require much skill, but it does require you find the seller before anyone else.

Wow, great comment and content by Sam, John, Jerry, and R. Kerry!

John Fedro

thanks Jerry: That helps a lot.

You can find some excellent deasl with HUD properties-I am a former contractor for HUD and listing broker of HUD properties and financial institutions. But anyone who says HUD will finance anyone is dead wrong late night gurus. When bidding on HUD's you will need to have your financing in place prior to bidding-any responsible agent will not even place your bid without a POF or Preapproval-I never will especially for new clients. Bidding on HUD properties for wholesale purposes requires patience because the acceptable Bid criteria within the first 30 to 60 days will not allow for enough of a deal for an attractive wholesale deal. There are some cases but rare. Good example was one of my listings that listed for 80k but sold for 27K after 90 days.
Sounds like you need a financial partner where you do all the work and they provide the funds but you need to get some experience. Join a local REIA and hopefully you can find a mentor.

Thanks James. Looking at that now

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