All Forum Posts by: Allen Felker

Invest; Verb  

expend money with the expectation of achieving a profit or material result by putting it into financial schemes, shares, or property, or by using it to develop a commercial venture. 

I'm expending money when I market (direct mail) with the intent to see a return (Double close 80+% of the time). 

My arguments are bogus to you because you're an agent. But I'd out negotiate any (ok not any but MOST!) agent, I'd do a better job at your job than most of you guys, I just don't like office politics and showing picky tire kickers around beautiful homes, sorry? 

John, you seem like a very intelligent person, so I BET you understand that sometimes it isn't about getting the best price for a seller. He could have made 30k more? Sweet, I could've been a basketball player if I was 4 inches taller. 

I respect all opposing views, but that's the problem with some brokers and agents you guys only focus on the MONEY. i've been in situations where I made $470.59! Assignments JUST to help a seller (she was an older lady, her husband passed away she was done with it) and i would've made 0.00 if I had to. I've never had a seller get mad after a deal. At least not yet. 

One of the first things I ask sellers is if they want to list ( my partner is an agent and I bet she's gonna be pissed at some of my comments, I'll buy her coffee), I tell them I don't buy at retail value, I'm not forcing anyone to sign anything like these fake "We buy houses" Clowns, once again full disclosure is key. And unlike most of them I can close because I have a relationship with a private lender, so I'm not doing too many assignments these days. 

Found* a better deal

I've seen agents convince a seller to list at a certain price that the CMA didn't even justify.

I've seen rehabbers, who actually have the personal capital to close kn a deal back out because "they sound a better deal" 

I've also seen police officers kill innocent men, yet the wholesaler gets the bashing. 

EMD isn't required in my state, we do not, and have not EVER put a gun to a sellers head and told them "you have to sign this contract, and you have to take less than $1,000 in EMD" I don't know about Florida but in my state you have to be 18 or older to own or sell a home, so we're dealing with adults here, that can read too! (Would you believe that?) They know what they're signing, there's no tricky language at all.

Personally, I'm not gonna go put 10 houses under contract and pay $10,000 in EMD, that's money my kids can use, money I can use for marketing so I can HELP more distressed sellers.

Its illegal to market a property you don't own. 

That's acting as a broker/agent 

Market the contract. 

It's scary when you're starting out in this business, one minute you're on cloud 9, you finally found something that could potentially get you out that horrible 9-5 job, then.....you come to BiggerPockets and you hear how you can't do this or that as a wholesaler, they make it seem almost impossible. 

Try this: 

In your contract put a clause that states: Seller relinquishes the rights to market the property to (insert your COMPANY name). 

Some people won't like it some won't care, if this clause works in your state (speak to an attorney first!) Then you just found a viable loophole. 

Happy Wholesaling!

Wholesaling real estate can be life changing. I know a lot of people who started from nothing and now make 6+ figures annually doing so, that pisses agents off lol. 

The things I see about wholesaling on BiggerPockets are discouraging and borderline hate speech. 

Basically, the kids that grew up the nice comfortable middle class neighborhoods, went to college like mommy and daddy told them to are telling people that dont have the credit to get a traditional loan or capital to close on a property that you can't be in real estate. 

If you don't have a sh*t load of money to spend, or near excellent credit you shouldn't be in real estate, is the summary of the BS I've been reading. 

Now on to the legal part of it all...

Is wholesaling ILLEGAL? 

No. Wholesaling is simply buying something low and selling it low enough for the end buyer to make a profit. 

Assignments are legal in most states, some not so much...in every state that doesn't allow assignments I GUARANTEE there's an agent pissed off at guy who made his annual salary in one deal. 

Guys and gals, remember: From a legal perspective for a contract to be legitimate you have to have the intent and ability to close. 

The intent comes when you partner with a Transactional lender to fund your deals, you then have the intent and ability to close, if you meet the transactional lenders criteria with the way the deal is set up. 

Now I can already see someone saying "well if you're wholesaling you don't have the intent to buy" Well...you do. But you're only going to close on it if you can sell it, that's actually smarter to me. Rehabbers buy with the hope to sell, as a wholesaler we buy (double close) when we KNOW we can sell and I advise you to be upfront with your sellers as well. 

If you're an inspiring wholesaler be careful with what you pay attention to on here, chance are you got into the business due to lack of a big ol' fat bank account, excellent credit, connections, etc. (All the things the guys bashing wholesalers seem to have...hm...)

Organize your business, learn the laws, help sellers, be honest with them, and by all mean IGNORE THE WHOLESALING BASHERS ON THIS SITE. I bet none of them had to wholesale their way out of $37,380 in debt and a motel room. They don't know the struggle, they don't want you have a bigger pool than Kanye! 

But all jokes aside, guys and girls wholesalers get a bad rep because there are some people who mislead sellers, honesty and full disclosure is the key. 

I understand some people are afraid to tell sellers they wholesale, and that's understandable Don't say that; What you want to do is set up an LLC before you start, get the website the logo, etc. Look credible. Build your buyers list, build your transactional lender team as well, your business is dependent on those things.

So what do you say when a seller asks what you do or what the hell the and/or assigns means? 

"I work with a group of investors (the transactional funders and cash buyers; truth here!) I buy and sell properties to other investors, sometimes I'll assign the contract just to simplify things, that's less in transfer taxes, etc. 

....if they don't want you to assign it (yeah some people are picky and sensitive) and the numbers make sense just double close using a Transactional lender, 0 money out of pocket. It's very simple. 

So, let's go over that again. 

The "INTENT AND ABILITY TO BUY" comes from having a Transactional lender on your team, develop a relationship with them, get to know them. 

Too many people just brush off this idea, well let me tell you, the agents are getting tired of us helping sellers and making a killing so they're running to the big bosses and trying to stop it all, one day assignments may be illegal everywhere unless you're an agent, so in case that day comes be ready. 

Excuse any spelling or grammatical errors... actually don't, I don't give a sh*t. I made my point. 

Happy wholesaling! 

I see a HUGE Hole in that logic. 

1. 9 times out of 10 when dealing with a motivated seller, they won't be able to sell traditionally due to repairs needed etc. 

2. Acting as an agent without a license is a push, in Wisconsin once you're under contract you can actually sell the home to someone else. When the seller relinquishes those rights to market via contract you become the seller. 

3. Agents do protect sellers from frauds, but a fraud is just someone who does have the network or capital to actually close on the deal. 

4. Trust me on this, if that agent wasn't getting a commission he/she wouldn't even work the seller. There in it for a profit too. 

5. The agents I work with are part of the company so when the COMPANY markets the property it's 100% legal. 

6. Distressed sellers, people who NEED to sell quickly, and can't afford to pay commissions and closing costs won't even get a prayer from an agent these days. Investors are needed. 

7. Full disclosure prevents a lot of BS. No one should lie to the seller, ever, these are people who need our help as investors, taking advantage of people isn't Typically what people are trying to do in this business, there are some though.. including agents. 

8. I only see bad outcomes when someone says "I buy cash in 3 days" and can't actually perform. When you have a team and systems in place and your money lined up you'll be okay  

9. People tie up houses and can't resell them to investors, realtors list houses on the MLS and they sit, doctors perform surgery and sometimes the cancer still comes back, sometimes it just doesn't work out. No need to bash wholesalers, I promise we're not evil lol:-)

As far as backing out of the contract if you find a buyer I'd tell the seller straight up: "No one in my network decided to purchase the deal, I only buy if i can sell it, I'm an investor. If we can renegotiate price maybe we can make something happen". 

That's pretty damn honest to me. Sometimes rehabbers buy and can't find a buyer that sucks. 

"Purchase is subject to buyers ability to quickly liquidate the property", if they don't like it move on.  

quick rant: 

I'm a wholesaler, I practice full disclosure, I close on the property and then resell 82% of the time and yes that number is tracked. 

Realtors lie to sellers and will have there house on the market for hundreds of days because they told them they have gold but no one says anything about that on BiggerPockets...pay attention. 

If anyone has any problems with what I posted re read it. It's 100% LEGAL, that's why there are platforms for everything i mentioned. 

Happy wholesaling. 

Always go into the deal with the intent and ability to buy, that does not mean you have to be rich, DO NOT listen to the people who were raised in the cushy middle class neighborhoods and never had to struggle to close a deal due to poor credit or lack of capital, to them everything that isnt traditional is illegal. 

Transactional lenders are legal. If you begin raising capital immediately you're doing pretty much the same thing a commercial deal syndicator is doing but they dont get bashed on BiggerPockets by the rich guys because, well 9 times out of 10 they work for the rich guy with the good credit, fancy degrees and harmless upbringings. 

If you can make money without using your own money then do it, some people on here act is of there's a net worth requirement to make a profit in real estate, there isn't. Don't let them scare you with their close mindedness.