Posted 8 months ago

Co-Wholesaling: 7 Steps to Fast Wholesaling

We’ve discussed the topic of co-wholesaling previously. However, this method for real estate investing is a great way to make money fast, and we want to provide even more information on how to make co-wholesaling work for you. As a real estate investor, you know a diverse investment strategy is the key to growing a long-term and successful real estate investment business. Co-wholesaling is one strategy to have in your investing portfolio to demonstrate your diversity and results.

Co-Wholesaling Defined

Co-wholesaling works like wholesaling but with a joint venture in place. As a review, wholesaling is a real estate deal where the real estate investor enters a contract with a seller to purchase a property. Instead of taking possession of the property, the investor locates a buyer to take over the contract for a larger purchase price than the investor originally defined with the seller.

With co-wholesaling, two real estate investors work together on a wholesale real estate deal. In these cases, one investor usually finds the seller while the other investor locates the buyer. While the profit is split between the investors, these deals are quick and easy. This is a great strategy to build your portfolio and make money while reducing your investment risks.

Co-Wholesaling Offers a Win for All Parties

The great news with co-wholesaling is that everyone usually wins. The seller is able to quickly find a buyer for their property. By going through the real estate investor, the buyer can avoid costly real estate agent commissions and closing costs.

The best deal is for the real estate investors. Because you are working together, the job to close the deal is reduced and the process moves quickly. With the power of each investor’s network and buyer or seller lists, the property and buyer prospects are increased. Both investors make money and build a relationship with the potential to work on deals together in the future.

7 Step System to Fast Co-Wholesaling

We’ve created a seven-step system to make co-wholesaling fast and effective. This method establishes a process to make co-wholesaling deals run smoothly by protecting the interests of both investors. By creating a system, no steps fall through the cracks. You’ll also have a solid method to make wholesale deals work efficiently over and over.

1 – Find Possible Wholesalers

The first step in the co-wholesaling system is to locate other real estate investors to enter a wholesale deal in partnership with you. Start with your network. Reach out to other investors you know that may be interested in a joint venture. The internet also makes it simple to find and build relationships with other wholesalers. Start with an internet search for “wholesaler” and your city name. Other ways to locate wholesalers are through Craigslist, Blinds Ads, and Bandit Signs.

2 – Qualify for a Good Fit

Just like every property you find isn’t a good fit to invest, not every wholesaler you identify will be a good fit for a solid joint venture. Ensure that your co-wholesaling partner is ethical and honest by qualifying your leads before you make a commitment. Ask for references and contact those references with a list of questions that covers the character and profitability of the wholesalers past deals. Talk about roles before you start the co-wholesaling process to ensure you are both on the same page.

3 – Set Boundaries

Don’t tie yourself too closely to another real estate investor. While co-wholesaling is a great way to build your portfolio and make money quickly, you’ll still want to manage wholesaling investments without a partner as well. Setting boundaries helps to protect your reputation and your network. Establish the right boundaries from the start to avoid confusion and protect both of you legally and financially. The point of co-wholesaling is to lower your risks and effort in order to close the deal more quickly. Solid boundaries will help the process run more smoothly.

4 – Who is the Seller?

Before you agree to a co-wholesaling relationship, determine what has been done so far in the deal. Is the other wholesaler asking you to join them? Or, do you have a potential deal and need a partner? Ask all of the detailed questions you would consider if you were working the deal alone. Understand the timeline for the deal and what steps have already been taken. Make sure you know what you are getting involved in before you make a commitment.

5 – Sign a Co-Wholesaling Agreement

A co-wholesaling agreement is critical to protect your interests and establish roles. Work with an attorney to create a contract that represents both parties’ responsibilities and financial split. Typically, there are two types of agreements. First, if you represent the buyer, the other party controls the paperwork. Second, if you represent the seller, then you have control of the paperwork. Once the agreement is signed, you are responsible for your part of the deal.

6 – Locate the Buyer or Find the Property or Seller

The role of each wholesaler will be defined in the co-wholesaling agreement. Typically, one person locates the property and the other locates the buyer. Establish your role in the co-wholesaling process and then get started on your responsibilities. Use the same methods you would for a regular wholesaling deal to locate either the buyer or the seller. Don’t drop the ball! Otherwise, your partner may not want to work with you in the future. Keep your long-term goals in mind.

7 – Sales Contract

Follow the process to close a wholesale deal. This means you need a sales contract in place with the seller that will ultimately be transferred to the buyer. Once the deal is completed and your profits are received, the co-wholesaling relationship is complete. If the deal went well and the relationship worked, consider future deals together.

Co-Wholesaling is a Smart Real Estate Investing Strategy

Make co-wholesaling part of your business plan to get your real estate investing business off the ground, build your portfolio or just make a fast profit. Follow our useful seven step system to fast wholesaling and start making money today with creative real estate investing strategies.