All Forum Posts by: Steven Leigh

@Christopher Phillips That is good info. Thanks for sharing. Question for you: Let's assume the homeowner is behind on payments but is NOT underwater on the loan. For example, let's say it's a $100k house, but they have 50,000 equity, but they are also at the beginning of the foreclosure process. If an investor or wholesaler wanted to purchase for more than 50k, wouldn't that be a possibility?

Will do. 

@P.J. Bremner Don't sweat it. I understood you were just highlighting the point again. :)

You know, your point about the 15k estimate reminds me about another problem, which is that some investors consider gutting a kitchen and bath a must when buying a rental, while others will keep anything they can, etc. This also makes it hard to do detailed estimates for repairs. 

By the way, some areas of Dayton you could get close to $15k for that scope of work if you know the right crews. It's one of the reasons Dayton is so hot for investors right now. Of course that would be more for a rental than a rehab flip. 

@P.J. Bremner I mentioned adjusting for different markets, but it definitely bears repeating. Other markets could be wildly different. 

And yes, photos and itemizing repairs goes a long way with buyers because they can crunch their own numbers. I would pay $8,000 for a roof but a rehabber I know has it done for $3,000. He will benefit from that with my broad estimate, but I don't care. 

Well the typical wholesaler purchase contract gives you a clause that if you back out of the deal they keep the earnest money as the sole liquidation of damages. 

Having said that, don't enter into a deal with the intention that you might back out. Not only is it unethical but you could get into legal trouble or face fines if the city or county gets wind of it. 

My recommendation is to make sure the numbers work before you sign. If they don't, just walk away. I had to back out of a deal early on because my numbers said it probably wouldn't work but I put it under contract anyway. I felt terrible and made their situation worse even though I was doing it to help them out. 

I learned the hard way that if you're not sure the numbers work you should just walk away. Besides, by walking away you may just find that the seller chases you and then they are willing to come down on price and the numbers suddenly work. 

Do you mean a purchase contract or something else? A purchase contract is what you use with the seller originally, then assign it to the end buyer with an assignment contract. 

You can find most of the forms you need here on Bigger Pockets. Go to Tools and then FilePlace and search for what you need.

To tell you the truth, foreclosures are not something I have really done, and I think some of it varies by city, county, or state. You could call some city or county offices and ask some questions and get more specific answers. You could make a separate post on Bigger Pockets on the subject too and probably get some good general answers. 

My focus has mainly on mailing equity lists and my local tax delinquent list. If you can get a tax delinquent list in your county I can tell you that you'll get a good response. These are people who are in trouble and need help. 

Good luck!

Driving for Dollars is a great place to start. 

https://www.biggerpockets.com/renewsblog/2013/05/0...

Foreclosed homes are tricky because you need to get to the seller BEFORE it's foreclosed. Otherwise the bank gets it back and it's what is referred to as an REO. Those can be lucrative, but people sort of specialize in REOs because they can be difficult and take a long time. They often aren't the best for wholesaling either.

Your best bet is to do things like driving for dollars or mail to high-equity lists in your area to find properties. Finding motivated sellers is kind of a vast ocean and there is a lot to explore and learn. It's a big question. 

Check out this article and pick a few ideas you like and try them for a while. Don't spread yourself too thin, as it's better to really nail one marketing channel than to try to do a bunch half-heartedly. 

http://retipster.com/50-quick-actions-you-can-do-t...

Technically yes, but properties on the MLS that are listed with a realtor are generally not good deals for wholesaling. Everyone can very easily find the properties on the MLS. Most of your wholesale deals should be properties that you have marketed to that only you have access to. That's what brings value as a wholesaler. If you send investors deals they just saw on the MLS marked up a few thousand they will laugh at you.

@Tiese C. One more thing. Just in case you're feeling like you screwed this deal up and maybe being hard on yourself, I'm a firm believer that the more you make mistakes early on, the faster you learn. And the lessons you learn from screwing up stick with you so much better than something you read not to do in a book!

I didn't understand how catching up on the taxes worked for my first deal, so the seller had to pay about $1200 more in taxes than she was expecting. She was pissed! But I'll NEVER make that mistake again now.

A seller gave me keys on one of my early deals, but I forgot to test them. So then I had to cancel a showing and drive across town to get the right keys. I'll NEVER make that mistake again.

The mistakes stick with you, and they make great stories! :)