All Forum Posts by: Brian G.

No POF? Then provide the realtor with a preapproval or hard money letter. If not leave the guy alone. He's already busy enough for this kind of distractions...

One deal here and one deal there. Maybe no complaint here. Maybe no complaint there. But at some point the wholesaler will have a few transactions under his belt. Now the complaints are starting to mount. Im not talking about 1 deal every four months but 1 deal a month (at least). This guy is grinding. Complaints are from relatives that dont agree with the fee % charged. Now there is a citation from the state. You dont have a license. The judge wants you to explain this fee north of resonable say 20%. What do you tell the judge?

Any of you have been in court for this?

@Brian Gibbons BOOM! This transaction your explained above for the grandma house brought it home. This is a powerful win-win-win transaction for everyone. And you had the guts to call the "we buy houses people" to boost your credibility? This my friend = infinite referral. Ethically and honestly without RE commission involvement. Expect the calls from the aunt, brothers, cousins, neighbors soon... 

@John Thedford agreed that market determines prices and brokerage is paid for services etc. The 6% is pretty much reasonable in the Miami market. Call it 5% or 7% or 8% that was not my point. Maybe my post was not clear. My point here is more when you as a wholesaler-licensee have a fee that is north of reasonable, say 20% (putting the property under contract for $50k and finding a buyer willing to pay $60k). Of course the seller can accept any terms (selling price/service fee). I get it. Here is an scenario: Say wholesaler-licensee have done several of these transactions. Now all of a sudden family members (non deed holders) are finding out that their parents or relatives have sold their house for an unreasonable fee. Right or wrong they are furious and have convinced their relatives to place complaints against the wholesaler-licensee in Tallahassee (which is very easy to do online with a couple of clicks). Now wholesaler-licensee gets a citation. My question is: as a wholesaler-licensee how do you justify your 20% fee position in front of the judge during a complaint? Now, @Brian Gibbonsis suggesting to act as a Principal. For this a wholesaler-licensee must beef-up the contract to a level where it is easy to demonstrate intention in court that he/she made the seller aware that they were not representing the seller and were actually looking to make a HUGE profit on the deal. This could work but if relatives find out this would not change the relatives perception on the wholesaler-licensee. Is this a long term and sustainable business model?

I am not a wholesaler and I am licensed. For the moment, we are buy-and-hold in Miami and flipping in Palm Beach. We identify wholesale activity everyday but our business model is different. We market to the same sellers and if it fits our criteria then we close on the properties like @Jay Hinrichs suggested. Instead of angry relatives we develop the relationships and we get the referral business from the aunts, grandmas, daughter, neighbor, etc. One lead could turn into several deals = less effort. We sleep better knowing that we are clean with the Florida Department of Business Professional Regulation.

In regards to the "state slaps you with real estate ethics and standards" comment I made, it is just the reaction I get from other wholesalers I have talked to that are sitting or have taken the exam. It seems that they fill somewhat uncomfortable with that specific portion of the exam. I am in full agreement and glad to be in compliance with all Florida real estate ethics and standards.

@Jesse T. I agree...

All the best...

Hmmm. So you go through the learning process of understanding how to find "off market" deals. Then you figure out the right marketing after spending endless amount of money pulling lists and crafting the correct mail piece. Then the avalanche of tirekickers calling. Then after the 1,500th call you detect a motivated seller. Then you read a post like this and say "sh*t... i better get my license".  You study for the exam.  Then you sit for it and Boom... The state slaps you with Real Estate Ethics and Standards where you must deal fairly in an ethical, moral and legal way. So how in the world a now wholesaler licensee is supposed to justify (moraly, ethically and legaly) an above market and well known 6% commision to the seller during the presentation? Is the answer double closing?

Agreed. No way agents will drive around without a solid purpose. They are highly trained to smell "motivation" a mile away. Motivation meaning buyer ready to buy right away (for the right deal) with either cash or a preapproval letter. 

Hi @Larry Hatten  by now you should be getting some type of traction (or not). How that looks after @Michael Quarles  generous assistance? Thanks

Hi @Oyoshy S. a fighter here from Carolina-lina-lina PR. Income properties and flips in Florida and PR since 2005. Skin like a Rhino. Ready for the next deal... Welcome to the site. Ponle!

Congratulations @Nicholas Moffett . There are tons of BP members that have lost their shirts in their first deal. Geez... Some of us think we have a deal today... Lets see how the numbers look after closing. You just added a very powerful weapon to your arsenal - I am sure by now you have a strong spreadsheet or another tool to estimate rehab costs. These are real costs... by the cent, square-foot or unit-of-measure. You took action. That's whats matter. On the next one, you will have more arguments to defend your negotiations. Even more if you buy again in the same area. You already have the numbers (acquisition-rehab-disposition)... All the best moving forward. 

Hi @Carey Cahill  glad to know you are ready to jump into it. Between deciding if holding, flipping or marketing for distressed homeowners you will quickly realize that significant analisys of each strategy will paralyze you from acting. A lot of BP members would argue that starting flipping is better than holding or viceversa - there is no right or wrong answer. It depends on your finances, goals and wants/needs. For us... we are doing all of the above. 5 properties so far. 4 rentals and 1 flip. 2 acquired last 2 months. We became landlords first, got dirty with toilets and tenants and then transitioned into flipping. Starting with passive income was simply a good fit for us. After understanding values and renovation costs we added the flips. Marketing to distressed homeowners is happening by nature as deals are going to start emerging from unknown sources. All of this happened because we took action (which is the most difficult part of this business). Looking back, the only thing holding me back from starting was the fear of messing up. I quickly learned that in this business there is no progress without struggle and taking action is a MOST. 

In regards to your offer placement, I was there to. 2 offers here and there with nothing to show until I crancked up my offering to 20 per week. It was here where I started to learn from counteroffers and negotiations. Soon we started to secure deals. In regards to the 1% rental, you will also learn that 1% is not necessarily a bad thing. There are tons of BP members doing it and the strategy is working for them.

As you can see it's all about taking action - MASSIVE action.  And if you make a mistake, its ok. Find ways to recover quickly, learn and move on. All the best to you and congrats on taking ACTION!