All Forum Posts by: Ryan Miller

Originally posted by @Matt Motil:

Originally posted by @Jonna Weber:

There are some opporturnies from good wholesalers. My experience is that it is simplest to be a cash buyer to make it work, and that you should (obviously) know your market really well going in. Some deals are fantastic- others might as well be retail. Speaking of MLS, before you sign, definitely look to make sure it is not a property that is already on the MLS, branded as an exclusive wholesale deal. I have had new wholesalers approach me with those types of "deals", and I am an agent who knew about the listings.

I literally LOL'd when I read this. I have had multiple wholesalers contact me before about properties on the MLS too. In some cases, I had multiple wholesalers contact me about the same house that was listed on the MLS! No better way to ruin your reputation as a wholesaler than to try and pull that crap.

That blows my mind. I've worked with some expired listings, but I can't/won't get a deal on a MLS listed property. I've had guys try to pass me deals on things that were on MLS as well, I pretty much shrugged it off and was on to the next one.

I know there are a lot of people trying to wholesale these days, but really the amateurs just make the experienced guys look better.   Although I'm sure it's annoying to weed though a sea of amateurs to find the pros.   

You sound like a politician. "Skirting laws" and "loopholes." Just because one state makes it illegal , means it's bad ? I wonder who pushed for that law? I have realtors that constantly send me properties to wholesale because they don't want to deal with it if it's not turn key. Investors like to buy for me , because I do the leg work, and find them properties. The seller gets paid what they agreed to sell the house for, the buyer pays what they agreed to pay for the house, and I get my assignment fee. Everyone wins. I get referrals from sellers more often than you'd think, and I tell them I work with investors. Nothing sketch about what I do , because I'm not sketchy.

Originally posted by @Adam Hershman:

Originally posted by @Jacob Buchanan:

I am having trouble grasping the general idea of wholesaling. Any help??

 Hey Jacob, 

Generally wholesaling is finding a suitable investment property, contracting to purchase it effectively taking it off the market, and then marketing that property to your buyers to assign them the contract allowing them to purchase the home. Essentially it's similar to flipping houses, except you never actual own the property, and you don't do any repairs. Another way to look at it is, a wholesaler does the leg work of finding the right property at the right price and taking advantage. He then turns around, before closing on the house, and assigns the contract to an investor for a profit.

Although I could be completely wrong. I think wholesaling is sketchy so, I tend to stay away from it. But BP does have a guide, you can read it here: https://www.biggerpockets.com/renewsblog/2006/11/2...

Adam

Nothing sketchy about it unless you're sketchy.    

65% is super aggressive in DFW. I mostly run my numbers at 78-80% of ARV minus the cost of repairs. Then I add in what I need to make on the deal. In hotter areas of DFW I go as high as 85%.

That being said , the numbers are the numbers. Normally when it's a super low number I go over the numbers with them.  I also look at cash solds in the area and see if those cash solds are owned by investors.  That gives me a good idea of what they are willing to pay for a property.    Often that's my best course of action. Sometimes the numbers are the numbers, but that does not mean your numbers match the buyers numbers. 

Originally posted by @Darrell Shepherd:

Ha, I don't assign, but my guy tells me what he's making and I couldn't care less as long as I hit my numbers.  In fact, he usually tries for way more than I'm willing to pay so I set the price more often than not.  What Bill said is accurate, though.  If you are closing on the buy, you are a seller, not an assignor.

I'd probably balk at $40k, though, unless it was a higher end property.  Thats a lot in the $200k houses I play in, not so much if its a $1.6 mil deal in California.  That's pretty awesome for a wholesale, btw, I don't make that on half my rehabs.

It was a rare deal for sure.When it came down to it, the buyer knew he could not get another property in that area, and he was still going to make money on his end when he flipped it. 

Originally posted by @Josselyne Lugo:

Originally posted by @Ryan Miller:

I agree w/ Bill. I just tell them if the price works for them, then it works for them. If it does not, then they don't have to buy the property. I've only double closed a hand full of properties. I've had assignment fees as high as 40k and did not double close. 

 Wow 40k on a single deal thats awesome!. Can you share some details about that transaction? Just curious to know Im just getting started on wholesaling and have yet to make my first deal.

It was a hot area, and the seller named his price. I agreed and someone offered me that much more. I've had a couple close more more than that, but I did double close on those deals.   Trust me it's rare, and I don't "try" for those kind of spreads, but if the deal is right for the investor, and for the seller then everyone wins. 

I agree w/ Bill. I just tell them if the price works for them, then it works for them. If it does not, then they don't have to buy the property. I've only double closed a hand full of properties. I've had assignment fees as high as 40k and did not double close. 

I only made it though the first page of this , but as a wholesaler I don't really mess with property that's listed on MLS. I guess some people are just taught wrong. If you don't like what they are sending you, ask them to quit sending you deals. I've never taken any classes or read any books on wholesaling, but to me it's a pretty simple process.

Get a property for less than what an investor would like to buy it for, then pitch it to investors. I look at cash solds in the area, and see how they compare my property. If I don't see many, I just look at the ARV and run my formula that way. I'm sure investors get tired of amateur investors, but on my end it just makes us look that much more professional when we come w/ good deals.

Could you just double close on it?  I hate double closing unless I have to. I'd either do that or find another title company. 

I agree w/ Brian. I'm in DFW so my formula is ARV minus 22% minus repairs then whatever I need to make in the assignment fee.

So if the comps are $100k and the house needs $15k to sell for what the comps are selling for you're way off with 90k.    Look at square footage, what the other houses have that this does not etc. 

100k ARV with 15k in repairs I'd buy it for $53k If you're using Brian's formula you'd need to be at 45k ( if you want to make 10k on the deal)

The buyer would only NET $92k if they sold it on the open market and paid a realtor plus closing costs and title policy.   If you give the seller 90k for it, what are you think you'd sell it to an investor for?    (hint, he's not going to buy it)