All Forum Posts by: Account Closed

Spot on guys! Non-refundable, fully-depositable earnest money keeps 'em honest.

Point/Counterpoint!

The absolute best way to build a “quality†buyers list is by marketing an actual property. Some aspiring wholesalers are under the impression they need to begin building a buyers list before they can start making offers. First things first … deal then buyer. Besides, you already have plenty of buyers lists available to you. One good deal under contract will give you access to buyers lists which have taken years to develop. Money talks, and a good deal under contract is money in the bank. You just need to decide who you’re going to share it with.

In other words, until you have a buyers list that can stand on its own, take your deal to another established wholesaler and split the profit. Not an exclusive agreement, though, you will maintain the right to sell on your own. With your concurrent marketing, your buyers list will grow quickly.

Gurus will give you all kinds of email collection techniques, but its quality of data over quantity. People who contact YOU as a result of marketing a property are buyers who are looking NOW! Marketing and advertising is how you build your buyers list, and you don’t market something without a product.

Hey, Dan!

The only time you should run title searches is when you’re buying from the courthouse steps or working with preforeclosures, neither of which I would recommend.

Your buyer’s lender will typically determine when and where escrow will be opened.

The fast-paced nature of wholesaling makes running title searches prior to making offers and signing contracts impractical. Will you run into title issues? All the time, but they usually can be worked out. Once the deal is in escrow with everybody’s interests at stake, there is much more attention paid to resolving title issues.

Don’t worry about all the what-ifs. Clear each hurdle as they come. Clear your mind of everything else, find the deal and get it under contract.

Agreed. You can lead a horse to water, but you can't make him drink. JUST DO IT!!!

Patrick,

You don't market without a product (cart in front of the horse). Deal, then buyer! Marketing your property is how you build a buyers list. Also, use an established wholesaler who already has a good list and split the profit.

John

Cody,

If you're lucky enough to get a contract for $10 Bucks, yes, you hand them the dough. Escrow comes later.

Matt, it's in the book I sent you!!!

•Vacant houses return to the tax roles providing more revenues for local government
•Rehabilitated property reduces that impact of housing shortages
•Investors utilize many resources from agents, lenders and appraisers to title agencies, attorneys, construction crews, landscapers and on and on
•Incomes are generated and local businesses are patronized
•A flourishing housing market equals a flourishing economy
•And I help other aspiring entrepreneurs become successful real estate investors

In 1999, after a year of reading books, “harassing†other investors and faxing typed letters from the floor of my apartment (Yes, with a typewriter. I didn’t even own a computer.), I bought my first house, a duplex, with a no-credit-check loan at 10 points - 18% interest, yikes. I had just quit my 3rd shift job working in an archaic, limb and digit risking envelope factory. I had two weeks before my rent and car payments were due, and I had no money.

I was able to pull some cash out of the repair escrow to stay afloat. While putting on a new roof and painting the house, a lady from across the street who managed a rooming house (or more accurately, a drug dealer who managed a crack house) had come over to me and said she wished I could do that to her house. I said give me the name and number of your landlord. Within two weeks, I had seven rooming houses (drug houses) under contract. These houses were beyond imagination, piled with filth, raw sewage and lived in.

I ended up buying and selling four other houses on that same street. The rehabilitation that was going on, in turn, had brought other investors into the area. Over the course of a couple years, the whole street had turned from a war zone into a neighborhood.

You CAN do good in the hood!

Tiara,

Don’t listen to those naysayers about needing a job! Practically speaking, it should be much easier with some sort of stability and a cash reserve. In reality, however, stability often breeds contentment. And contentment is rarely conducive to change.

Starting a wholesaling career in Detroit, on the other hand, right now? That, in all reality, is a tall order. I’m currently in Cleveland, and our cities are two of the most saturated in the nation. Woe is us.

What would be just as bold, but more productive, would be to move. I’ve got one more house to sell here, and then I’m getting the heck out of Dodge.

Since you mention assigning contracts in your profile, I wanted to offer a wholesaler’s perspective. Actual “investing†in the hood has both pros and cons, which has already been discussed. But if you’re talking about wholesaling, YES, get your mind out of the burbs and into the gutter!

Many, if not most, new wholesalers, who haven’t spent much, if any, time in the hood, are the same way I was when I got started, apprehensive, if not, fearful.. The natural tendency is to look for deals in the suburbs. It ain’t gonna happen. When I talk with new investors who say, no war zones or not these zip codes, I say, call me back in a couple years when you’ve found your first deal. The “spreads†or profit margins simply aren’t there. The deals in the burbs are usually proportionate to the repairs required, where the deals in the “rougher†areas have disproportionately higher profit margins.

For the purpose of wholesaling, the inner-cities or older, lower-end neighborhoods are where you wholesale. I have come to learn that whether or not a neighborhood or individual house is “nice†is all perception, anyway. I now see beauty in all structures. A good wholesaler looks beyond the filth, stench and decay. A good wholesaler sees a house just like a good rehabber, for what it could be, not for what it currently is.

Having grown up in a small, all-white town in Ohio, the inner-city of Atlanta where I got started was culture shock to me. But I gotta say, living in the North Georgia Mountains when I first arrived, where every person I saw had some sort of camouflage clothing on and a bloody deer strapped to the hood of their car, was culture shock, too. Can anyone say, “Deliverance?†The fact is there are good people every where, just as there are bad people. The bad people are just better concealed in the burbs.

I’m not trying to suggest that some of these neighborhoods are not truly scary and dangerous. They can be. I sold a few houses in an area known as “The Bluffâ€. It was only several blocks big, but accounted for the highest murders per capita in all of Atlanta. The thing to keep in mind is most of the crime takes place at night, against and among hooligans who live there. It’s not like investors, delivery drivers, mail carriers, utility workers, service technicians, and other outsiders are being slaughtered by day!

What I’m trying to get across is you don’t want to fear the place you work. Bad elements can smell fear like paint on a wall, and fear breeds vulnerability. I see it all the time, investors driving neighborhoods with their windows rolled up, doors locked, afraid to glance too far from their notebooks. I even know investors who won’t go down to the hood unless they’re packing heat. To each his own, but sometimes I think some issues run a little deeper than practical safety.

Be cautious, not nervous. Simple eye contact can go a long way in dissuading malicious intent. Just like the mighty lion in the savanna … whenever their prey looks away or looks down to eat, the lion creeps closer, and if the prey looks in the direction of the lion, the lion will cease its movement and remain still. Act like you are in control, like you belong there, and you will be fine. Even though I know many independent and confident female investors who get along just fine by themselves, I normally recommend that women take someone along with them whenever possible.