Another buyer offering Cash Advance??

Question

Hi BP - needing advice. I'm trying to lock up my first wholesale contract and competiing with another buyer who is offering a Cash Advance of $10k to the seller. Reason is the seller is wanting to buy a vehicle before closing so they can be ready to move. How can I compete with a cash advance offer? Also, would like to better understand how the cash advance process would work - this seems risky.

Thanks!

Account Closed · Answer

I wouldn't chase a deal like that unless it really makes sense. As stated early, it essentially is a nonrefundable 10K, OR its in a contract that they get the upfront money and have to pay back later after property closes. Long story short, stay focused and don't chase deals. In your career you will run into the most oddest situations - they don't tend to be worth it most of the time.

Will Barnard · Answer

To Don’s point, a good wholesaler finds a motivated seller where the property is not publicly being marketed currently (MLS or online FSBO) and locks the deal (with intent and means to close of course). The fact that you are competing with another buyer tells me this is on the mls and you are wasting your time and that of the seller on this one.

Don Konipol · Answer

@Evan Stamps

You’re trying to convince the seller to give you a near free “option” whereby you tie up his property with no obligation to close and spend the time trying to find a buyer at a higher price and keep the difference.

Meanwhile a REAL ( as in will close without having to find someone else to buy the property) buyer is willing to close with no contingencies and provide $10,000 hard, non refundable earnest money.  And you believe that there exists a “trick, technique or ploy” by which you can convince the seller to accept your offer over his?  Does that even make sense?

Evan Stamps · Answer

thanks for the explaination!

JD Martin · Answer

Depends on how it is structured but essentially the other buyer is more or less giving them $10k in non-refundable earnest money (or the seller is holding refundable earnest money and using it to buy a car, not very smart). If you can't come up with either a better sales offer or more money then you probably can't compete with that.