Any experience Daisy chain wholesalers in Phoenix AZ?

Question

Hi,

I'm closing my first wholesale property in Scottsdale, AZ. The buyer and seller contract isn't mines so I'm planning on daisy chain the deal to end buyer.

My question is how and what do I need to close this deal?

My research shows that I need buyer/seller contract, wholesaler to wholesaler assignment contract, assignment contract to end buyer. If this is the case, where do I get a hold of these paperwork? Also do anyone have any additional tips to daisy chain process?

Any details is much appreciated.

Duane Alexander · Answer

Daisy chaining is still the worst way to do what you want to accomplish. That is not a JV. A JV would be me and you signing a joint venture agreement, specifying that we'll split profits 50/50% on the sale of a particular property. A JV is not me assigning my contract to you to assign to somebody of your choosing, who can assign to somebody else, and so on and so forth. Like I said, don't be a daisy chainer, there's a better way to do this for all parties.

Jack Luu · Answer

like I said I have an end buyer, not another wholesaler. I understand and agree with you the chain can get long and deal never close but this is not the case with this one as this deal only involves 4 parties. You also must understand that the direct to seller wholesaler does not have buyer or else they would have closed without me and leave my proposal off the table. Therefore regardless this wholesaler would already have spend money, time finding seller, and market to still not find a buyer. However I may just send the wholesaler this end buyer in hopes they will provide me a finder's fee.

If not, no big deal and I move on knowing this is their method and we won't work out. Opportunities ends when you don't even try to make it work.

I do commend you on your passion on wholesaling but I still believe transparency is key for all parties to be happy about the deal.

Duane Alexander · Answer

Sounds like all of you are inexperienced. I would never allow a daisy chainer to take control of any of my deals. Any wholesaler worth their salt is taught to avoid you guys like the plague. It's a fast way to end up in a situation where there's this long line of assignments from inexperienced people like you who are putting homes under contract hoping to find a buyer (who 9 times outta 10 ends up being another daisy chainer), while most of the time not putting in a significant amount of EMD. And when the last guy in the chain can't find a buyer, it's the direct to seller wholesaler, who has spent a lot of money and time to find the seller and market to them, that has to have that tough conversation with the seller about how the deal fell through. It's a ridiculously lazy way to do business for all parties and a part of the reason why wholesalers get such a bad rap.

Jack Luu · Answer

@Duane Alexander

I would agree with you but some would see wholesaling as something negative as well. If you're completely transparent on what you're doing, daisy chain shouldn't be too different from JV. As long as everyone is able to eat and everyone agrees to the terms with transparency, this type of agreement shouldn't be negative.

I've talked to both sides (wholesaler & buyer) and they're both in agreement since they're able to make the numbers work. Buyer see an MLS listing with exact layout that I've provided which closed last months. Seller also agrees as long as they get their net selling price based on wholesaler's response. Also the chain stops with me as I am bringing the end buyer.

I don't judge how deals are conducted as long as it's transparent and will close doors if I feel someone is hiding something.

Duane Alexander · Answer

Don't be a daisy chainer. Find your own leads. Daisy chainers are truly the lowest of the low and the laziest form of wholesaling. It's a quick way to get black listed among the wholesaling community.

Jack Luu · Answer

@Todd Rasmussen

Hi Todd,

Appreciate your input. I do have a buyer's list hence is why I am trying to get properties already under contract so I can connect to the end buyer. I like to JV deals so I can close more deals.

Todd Rasmussen · Answer

@Jack Luu

Hi Jack,

I do not see what value you are bringing to this deal. My advice is not to get involved.

To get some experience, you should find someone wholesaling in the area and bring them leads in exchange for going through the process to get experience. You can take that time to build a buyer's list of your own and when all the pieces are in place you can close one of those leads yourself. Good luck.