Advice for a newbie wholesale investor!

Advice for a newbie wholesale investor!

Linesville, PA · Member since 2016 · 17 posts · 2 votes
Hello Everyone! My Name is Dustin. I’ve been a member on this site for awhile now. I’ve spent a couple years learning and saving and finally made my presence in the real estate world last year when I bought my first rental property. Nice 4-unit. Also working on another rental property as we speak. However, I’ve finally decided it was time to put all my knowledge to action and start wholesaling to help fund my rentals. I have a motivated seller, who has verbally agreed to sell me her house at 55k. I comped the area, this price is roughly 50% of arv. And really doesn’t need much work at all. Possibly a kitchen update. Everything else is good shape and too many updates to list. Which, from my learnings, is right where I want to be. The woman lives 5 hours away, will be meeting her in 2 weeks with my contractor to do the inspection and sign the purchase agreement. I have the assignment contract ready, a small buyers list, my marketing skills on standby. But, I have yet to find a title company (I know, probably should have had this all done before). As an inexperienced investor, what should I do to find the best prices for closing. I know who to call. But what should I ask them? I have asked my real estate agent for help. She advised me that no one in this area is wholesaling. That it is unethical, and I should stay away from these type of deals. Thoughts on that as well? Any advice is appreciated! On the title company or any other aspect of the wholesale strategy. Thank you for your time! Dustin Cornell
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  • Rental Property Investor · Atlanta, GA · Member since 2014 · 807 posts · 274 votes
    8y

    @Dustin Cornell congratulations on buying your first rental property and deciding to use wholesaling as a way to fund your rental purchases. First off, I would encourage you to get the agreement signed ASAP. There are tons of electronic signing services like DocuSign, Right Signature, AdobeSign etc. Get it under contract. If she is either unable or unwilling to electronically sign, then send it via overnight mail with a return envelope and have her take a picture and send to you. Getting the signed agreement will allow you to start title work and help you to market what you have. 

    Second, ignore the title lady. You don't need people who tell you, you can't do something. Be persistent and just keep asking until you find someone who knows what you're talking about and allows you to do what you need to do. Ask the title companies if they are familiar with doing contract assignments and double closings. Double closings are where the end buyer authorizes you to use their funds to close on your precedent transaction (i.e. the house they want to buy that you haven't bought yet). If they say no or that's illegal like this other lady said, that's fine. Just move on to the next title company. Worst case scenario, find a transactional funding company (most hard money companies will do this as well) to lend you the money to close on your front end transaction before re-selling to your end buyer.

    Good luck Dustin!

  • Linesville, PA · Member since 2016 · 17 posts · 2 votes
    8y

    Thank you Marvin. That was exactly what I needed to hear! I’ll be making a lot of phone calls! I did tell her I would wait for the inspection to have her sign the documents in person. Thinking about your advice, I probably should have her sign them ASAP. My market isn’t exactly hot, so I wasn’t too worried about losing it. She already pulled her online ads. Even though I told her not too!

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