I’m struggling with getting my first wholesale deal for a few reasons but the main reason I believe is uncertainty on the legal side of the deal. I have downloaded and read a few purchase agreements for my state but I’m stuck wondering if I need to find an attorney to actually write up a contract that has all of the information and the contract be assignable. Multiple deals on my dashboard right now that I am eager to jump on but I do not want to contact the seller, make an offer, and give him a bogus contract that has holes in it. So my question is, for those that have successfully started wholesaling when you began did you have an attorney write your contracts for you? Also, how was your experience with finding cash buyers and how often did you have to actually use the inspection contingency as an escape?
As always, anyone willing to connect or give some words of advice please reach out through a PM.
Hi Ryan! Congrats on getting the ball rolling on your Real Estate career! If you are uncomfortable moving forward with your contracts then I would recommend getting yourself some peace of mind and having an attorney review the contract you would like to use. Instead of having the attorney draft one up, take the attorney one that you would like to use and have them review, this will save the attorney time and thus save you money. Then you will have the confidence to take that next step!
In my experience and my market everyone is looking for a deal, so finding buyers is not an issue. To find buyers in your market I would recommend finding someone in your area who is already wholesaling via BP, and to search for FB groups of wholesalers in your area, you will be certain to find some buyers there.
As far as inspection contingency it totally depends on property. It's there to help protect buyers, so if you need to use, then its great to have that layer of protection.
You got this! Good luck!
Great information, thank you!
@Ryan Kruger you are wise to be hesitant. I've posted here several times for newbs. You're not selling candy bars, you are attempting to transact in real estate. There is obviously a lot of liability issues. I always HIGHLY recommend you (or any other wannabe wholesaler) to invest a few hundred bucks or more and have a real estate attorney in your state draft up the purchase and sale agreement as well as your assignment agreement. They do not need to be overly cumbersome. My PSA is 5 pages and my AA is 2 pages. Also, I didn't start with tying up properties without a buyers list. I started by locating several busy flippers in the area and built my list to about 80 really quickly. But, all of my deals were sold to same 3-4 buyers. Good deals shouldn't need an out (aka inspection or feasibility contingency). Best wishes on your journey!
@Ryan Kruger welcome to phase 1 of real estate! Lol, it can be scary at first. Going off of what @Brandon Vukelich was saying, I got my Purchase Agreement from a local investor-friendly title company - I found this company off of recommendation in a local FB REIA group.
That gave me much more confidence, from there just get a general idea of how to run comps, what to say to sellers (know what happens from contract to close). I found a very trustworthy buyer at first (you can usually just tell who's trustworthy off a few phone calls), and double-checked with them before I got anything under contract.
In fact, I still do this today :) You're never going to be perfect at comping, nobody is - there are just some weird properties out there and nobody can change that. Just do a pre-lim comp, check with your buyer, and get that thing under contract. Sellers are just normal people like us, and many of them are very nice.