All Forum Posts by: Stephen Brown

@Brandon G. Generally speaking if you assign a contract both the buyer and seller will see your "assignment fee" on the hud statement. The buyer will also be able to see the name of the person selling the house. 

If you want to keep this information confidential, then you should do a double close. This will generate two separate transactions:

A to B (Your Seller selling the property to you)

B to C (Your Buyer buying the property from you)

This way your buyer will not know how much you got the property under contract for, and the seller or buyer will not know how much you are making on the transaction. 

Generally speaking if my assignment fee is less than 10K I will just use an assignment of contract, as this way incurs less closing costs.

If my assignment fee is greater than 10K I will typically do a double close to keep these numbers confidential. 

Because if the seller, for example, knows I'm making 20K+ on the transaction, the seller might not like that.....get cold feet....and back out of the sale. So in those situation doing a double close is just safer. 

Someone asked me yesterday where I got all of my real estate knowledge and insight.

BiggerPockets....the REI ONE STOP SHOP!!

Keep those Podcasts coming!! 

Great job gentlemen!!

@David Rupp we wholetail or list lots of the properties we get. This is a great way to get top dollar for deals we come across.

Having a real estate license would be helpful, but we just use flat-fee MLS, and list the property that way. We pay a realtor $100 to list the property, and then we take care of the rest.

@Omari Brown The best way to get access to the MLS is first to identify the right realtor. I would look for a younger investor friendly realtor...that is NOT associated with any big named real estate companies, like "Century 21" or "ReMax" because they are generally going to have MUCH stricter standards on such things. So find a smaller non-name brand real estate company.

Then the best way to do #3 & #4 is to make them money. Either having them sell a property you own, or bringing them great deals etc. Then show them how you can continue to make them money, and granting the MLS access will help make them even more money....so they couldn't afford not to grant you MLS access. That's how I did it...it worked for me :)

As a wholesaler here in Houston TX we only work with CASH/Hard Money Buyers, almost always. Most of our buy and hold buyers who want to use conventional financing, will use Hard Money, (which is as good as cash) to close on the deal, and then refinance into a conventional loan.

Because if it’s a good deal here in Houston, I’m going to have numerous Buyers willing to pay CASH/Hard Money and close on the deal within 7-14 days.

Paying CASH and closing quickly is a primary bargaining tool we use to get the contract.

There would be absolutely no benefit for us to approach the seller and renegotiate the contract and essentially say, “I know we told you we could close in 10 days and you would have your CASH in hand….but we have a Buyer using conventional financing so we will actually need 30-45 days because instead of CASH they will be using conventional financing.”

For a good deal....for any deal I would NEVER do this, just approaching the seller with this could potentially KILL the deal all together.

The only “DEALS” your going to find as @Mary B. mentioned are those properties just sitting on the wholesaler’s books, that NO ONE ELSE WANTS. Which as you can imagine are NOT going to be the best deals.

So you may consider using Hard Money and then refinancing into a conventional loan if you want to stay competitive with other CASH Buyers in a HOT market. 

@Christopher N Grant If you are serious about COMPS, you need access to the MLS. Everything else by comparison is completely inferior.

So what many people do, they cozy up to an investor friendly real estate agent. Take them out to lunch etc. Build a relationship and ask to be their assistant, and work with them. Which will grant you access to the MLS, without a real estate license. And you will be able to find REAL COMPS.

@Brittany Thompson If you have $20 you can purchase or make yourself some bandit signs. And place them at strategic high traffic intersections saying "WE BUY HOUSES" with your contact information.

Or hit the pavement, go knocking door to door, looking for motivated sellers. 

@Patrick Jacques It really is not that easy. I just provided a bunch of PRO's of wholetailing, there are several CON's which make wholetailing more challenging then wholesaling, in other areas, if compared side by side. 

Again this is why a good portion of our deals we simply wholesale. 

@Glenn Bravy Again using the above deal since it has already been mentioned.

The ARV for that deal was $124,900. Those were the actual MAX SOLD COMPS in that subdivision.....those COMPS just happened to be CASH. The repairs were around 8K.

So if I were to approach this deal as a wholesaler using traditional wholesaling formulas. I would take 70% of my ARV....which would be $87,430......then subtract repairs of 8K.....which would bring me to $79,430.......then subtract my wholesale fee, which I have a standard of 10K......which would bring me to $69,430, which would be the offer I would make to my seller....so that I can make $10K and still provide a good spread for my investors on my buyers list.

As a wholetailer I don't care about my investors making a good spread on the deal. I don't care about meticulosity calculating repair costs. The only thing I care about are CASH SALES of comparable properties, with low Days on Market in the same subdivision. Which again for this property was $124,900 with less then 5 DOM.

So if a wholesaler was trying to bid against me on this property, I would have outbid them and still made a lot more on this transaction. 

 As they would offer the seller $69,430 to make 10K on an assignment fee.

I locked the property up at $102,500 and made 17K on an assignment fee. 

That being said we don't wholetail every deal we get. Sometimes it's just easier to wholesale the property. So we evaluate each deal to determine whether wholetailing, wholesaling or flipping the property ourselves is the best and most profitable course of action. 

@Brandon Proctor 

VA's loans are great for owner occupied purchases. But if you are really interested in jumping full time into real estate investing, active duty military members can qualify for a small business loan through the Patriot Express Loan Initiative:

The Patriot Express Loan Initiative is designed to help you get the money you need to start a business quickly. In most cases, you will be able to get a low interest rate between 2.25% and 4.75%. You will also know if you can get the money within 36 hours of applying. With this loan, you can potentially get your hands on up to $500,000 to start your own business or expand an existing one. This represents a major perk of being in the military.

Read more: http://www.finweb.com/loans/3-types-of-military-financial-loans-for-active-duty-personnel.html#ixzz3B0HM73xW