A 60-Day Action Guide to Wholesaling Your First Property

by | BiggerPockets.com

So you want to become a real estate wholesaler? Great here’s a 60-day action guide to wholesaling your first property.

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Introduction

Before we get started, I do not want to give you any false impressions. This is not 60 days to $5,000 without working; it’s 60 days to get you in the game.

I like to use analogies, and I will start with this one to put things in perspective. If you had the opportunity to play one season without pay to make an NFL team the following season, would you take the opportunity? I’d bet you would.

Let’s say you are doing everything your teammates are doing. You are getting up at 5:00 a.m. to run, and you’re in the weight room, out practicing, and learning the plays with the team. You’re doing everything, but you’re not getting paid. What do you think will happen? Eventually, you’ll be able to do what they do and make the team. You’ll become a paid player. It’s just the same for real estate wholesaling—you have to be willing to put in the sweat equity to reap the rewards. So let me show what this process looks like. Keep in mind—this is just one way, but there are many ways to close your first deal.

A 60-Day Action Guide to Wholesaling Your First Property

Step 1: Define your purpose.

The first step of the process is to ask yourself the following: Why do I want to wholesale property? What is it that I want and need? If you cannot clearly define these things, then stop. Also, your answer cannot be, “I want to make money.” Of course you do, but you want to use the money for what purpose? You have to have a reason. The universe will not work towards bringing what you need if you do not know how you intend on using it. This is like going to a bank and asking for a loan, and when the loan offer asks, “How much do you need?” you say, “As much as you can give me.” The banker then says, “Well, what do you need it for?” and your response is, “I just need it.”

Sounds foolish, doesn’t it? That’s how some of us sound when it comes to our approach to success. We want it but have no idea what it takes or what success looks like. Defining your purpose should not take long, but it will take energy. I tell people to think back to when they were children. What really amazed them? Work towards that and dig deep. Your answer is somewhere in there.

succeed-vs-fail

Related: The 6 Most Common Newbie Wholesaling Questions, Answered!

Step 2: Join a team.

Using that same analogy of football, let’s say you now have to find a team. In searching for a team, you’re simply looking for a group of people who want to accomplish the same goals you do. As a real estate investor, this is normally easy to do. As long as you find those that truly love real estate, you can find a common purpose with these individuals, and you can help each other achieve common goals.

When you’re wholesaling, you need other investors to network with. You have to be able to pick up the phone and discuss real estate with likeminded individuals. You can find these people at real estate meet ups, cash flow games, and online forums groups like BiggerPockets. You have to make yourself accessible. I often tell people to friend investors on BP in their area and start a group or join a group already established. Go to Meetup.com and search “real estate investor groups.” This is where you will begin to learn what they learn, do what they do, and know who they know. Real estate is a contact sport; you have to get out and create contacts.

Step 3: Absorb everything.

Once you find a team, learn as much as you can. Do not be afraid to ask what you may think are dumb questions. Ask and become knowledgeable. There are specific things you need to learn about, including your market, potential buyers, what these buyers are purchasing, and where they’re buying properties.

Let’s start with finding buyers; you can seek out this information by researching all the recent cash transactions that occurred in an area. Without going too far into the details, let’s just say you can contact a local title company and inform them that you’re doing market research and looking for all the recent transactions without financing that occurred in the past year. Once you receive the addresses, you can search those addresses with the county assessor’s office to look for the tax mailing address. Once you have the tax mailing address, you can then send out letters asking them to contact you if interested.

Related: How to Set Goals as a Newbie Wholesaler (& Actually Achieve Them!)

Once they call you—because they will call—ask them what are they looking for. Ask them if they will be ready to move quickly if you find it. Now you have buyers.

This is normally where the fear begins to kick in. Push that fear aside. You will go through the emotional roller coaster of fear, anxiety, low self-esteem, and many other emotions in between.

Step 4: Pay to play.

Education is not free. However, it does not have to be completely unobtainable, either. Building your circle of influence will cost you something. This will, of course, cost you time, effort, and sometimes money. You’ll need to put your money where your mouth is. If you really want to be an investor, you will have to invest in yourself

You will not be able to reap the benefits without giving up something. While gurus often say that with little effort you can close your first deal and make $5,000, that’s simply not so. The beginning is the hardest. You need to “pay to play” by taking others to lunch to ask questions, investing in direct mail, or driving for dollars. Also, to increase your circle of influence, you will have to pay to be in the environment of those who are doing what you want to do.

Conclusion

This article tackles the psychology of starting out. You have to have a purpose, educate yourself, absorb a lot of material, have the right mindset, and finally, put what you learn to action. Education is the key. If you want to learn to do something new, you have to reprogram your thinking to see it materialize. To quote my college professors, “Put your theories into practice.”

Newbie wholesalers: Where are you in your journey?

Let me know your questions and comments below!

About Author

Marcus Maloney

Marcus Maloney G+ is the Executive Officer of Equity Realty & Investments as well as 3rd Generation Management & Holding LLC, both are family owned and operated real estate investment firms. The firms' goal is to provide affordable solutions in real estate while providing exceptional opportunities for community redevelopment for the residents of Phoenix, Arizona and Chicago, Illinois. You can follow Marcus on Twitter

27 Comments

  1. James Green

    Another great article. I especially like # 4. The gurus are always pushing that you should at least get 5K per deal, which is ludicrous especially if you don’t know what you are doing.

    I remember my first deal was 1K as a bird-dog fee. The buyer on that deal, asked me to co-wholesale a property he had & we ended up splitting 35K! Both deals closed within a week of each other.

  2. James Pelz

    Great article. Thank you! I am just starting out in the game. I have been to a few real estate investing meetups and have been actively using Craiglist and driving for dollars to seek out motivated sellers.

    Would you recommend co-wholesaling for your first deal with an experienced investor to get the first deal under my belt?

    • Marcus Maloney

      James Pelz,

      Thanks for reading I would recommend co-wholesaling for the following reasons:
      1) It’s ok to sacrifice money for education. The experience wholesaler will be able to teach you how to navigate the transaction.
      2) Being a key cog in the acquisition you can help with the disposition. This comes in the form of meeting cash buyers at the property. So you get a chance to meet players in your market and exchange contact info. Guess what that’s a “Cash Buyer”
      3) You will be able to meet other stakeholders like escrow officers, & attorneys to help build your team.

  3. Anthony Edwards

    I’m brand new to real estate investing. My focus, initially, is definitely on wholesaling. This article is very beneficial. I’m in Dallas TX, and the market is hot here. I’m hoping to find someone willing to mentor me on this journey.

    • Marcus Maloney

      Anthony, sorry for the delay man its been extremely crazy the past few months. Glad your ready to take action. Wholesaling can be challenging but if you are tenacious you will be successful. Remember to enjoy the Journey. There are many TX investors in the forums and there are great meetups get active and involved you will find that mentor. I have more information at equityrealestateblog.com especially for those just getting started. Check it out.

  4. Talia Erinna

    I just found out about this forum/group this week but I have been interested in various aspects of real estate for months now. Thank you for this article this was very informative for someone with no experience and so far, no mentors and major contacts. My first step as you mentioned is to join a group that does invest in real estate on meetup (I did find one) but I found an investment organization and I went to one of their seminars this week as well. I will learn this and I will be successful no matter how long it takes!

    • Marcus Maloney

      Talia, great you’re getting out there remember its a journey and there will be some setbacks but if your focused you will find success or better put success will find you. Just position yourself and read, watch videos, and network. For the first 9 months that’s exactly what I did to get started and it worked.

      Remember to enjoy the Journey

  5. Dave Knott

    Great article Marcus! I hope you understand the importance of these to new investors such as myself. Alot of people made wholesaling sound so easy and fast, but it takes alot of patience and knowledge as I am finding out. Thanks for the information, it definitely changes the way I am thinking about wholesaling.

    • Marcus Maloney

      Dave, glad I can help. I remember the struggles of getting started. All the false hopes of making millions fast, not knowing and respecting the process of becoming a professional. I have other FREE content at equityrealestateblog.com there’s a great book there for beginners that I believe you will enjoy. I write everything through experience and hard lessons that I’ve learned.

      Enjoy the Journey real estate is fun but challenging

  6. Brett Snodgrass

    Excellent article Marcus.
    #2 is the most important part to me. Even @JamesGreen mentioned teaming up with another wholesaler, creating a really nice deal. That is what it’s about. Great teamwork will bring you to many more deals.

  7. Thang Nguyen

    I’ve enjoyed this article. And I do agree with you. If you set your mind for the vision you want to achieve then it will happen one way or another. It’s the mentality that really matters, along with self education will you succeed.

    Thank you again for reaffirming what I’ve been reading. I’m new to the real estate industry as well. And this was very helpful!

    • Marcus Maloney

      Thang, thanks for reading. The mental aspect of getting started is where the battlefield is. It can be difficult doing something new and your mind will try and tell you its not possible. Keep reading the success stories of other as motivation, but be careful because you can begin to question yourself seeing others success.

      Get busy and keep learning and then take massive action. Thanks for reading if you want more articles go to equityrealestateblog.com I have a great beginners book for free there.

  8. Great Article, I am new to investing and the same forms of fear you talked about in step 3 happened to me. As time went on I became more comfortable. What I learned is after repetition and repetition, you soon get into a rhythm that sticks with you.

  9. Amanda Hedadji

    This is a great article, the suggestion about calling title companies and saying your doing research on cash transactions is brilliant… it is very easy to find buyers, I have found, but that’s a great way to find more!

  10. Christopher Walters

    Thank you Marcus for this Great article. Myself and wife are new to wholesaling investing in FL working on our first deal. We invested in gurus saying how easy and fast it is to make money but we found out real quick it’s not so easy and not so fast. Thanks again

  11. Terry Free

    This is a great article! I’m a newbie myself, out of Baltimore, MD, and recently unemployed. So, I’m taking a bigger risk than most. I’ve also spent money with the guru’s but stopped because it wasn’t as personal and hands-on as I would have hoped. This article has given me some ideas as far as how to find buyers and the importance of building a team. I hope to start soon as I’m not having any luck finding employment, outside of working for McD’s and I refuse to go that route.

    • Brett Snodgrass

      Thanks Anthony! Glad we can help. Feel free to check out some more of our blogs and podcasts on here as well as some of the stuff that we have done at Simple Wholesaling. Something to look forward to as well, we have a course coming out the end of this year/early next year. God Bless!

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