"The Scary Wholesaler"

You are funny! Waiting for the sequel. LOL

Femailceo its supposed to close next Friday the buyer has backed out 2 times already but yet has put a $3,000 NON REFUNDABLE CREDIT towards the property.

I wish there were some way I could let you all hear these conversations...either you would laugh hard or say OMG thats too stressful !

That is this "Scary Wholesaler" was trusting in you to help them out and you're saying that if The "scary Wholesaler" had a Buyers List, you wouldn't make a dime.

How did you learn to do that? Who taught you that?

I wonder if Matt does that too??

Not Good For Business!! If you're doing what I'm thinking,,,

Romaluv22
Signing Out,

First thing any wholesaler should have is a buyer list, not wait and scramble when their contract is about to expire. I always look for cash buyers within the zip of sellers on the MLX Change im marketing to.

The reality of the matter when you whole sale you only get paid when you either bring a buyer to buy or a seller that you have a ratified contract with. Youre right, I am helping them by bringing the buyer to the table so they can complete the deal. Im absolutely thrilled "The Scarey Wholesaler" called me and needed a buyer, also my proceeds shall be annotated on Page 2 line 701 of the Hud 1.

However, I’m not sure where they learned NOT to market for buyers BEFORE they get a property under contract.

The other huge problem is they try to wing it instead of investing in education to teach them correctly. Another one of their problem is they use unreliable sources to do their comps and come up with crazy valuations. When you don’t know how its done properly you get these types of problems.

The best thing they could do for their business is invest in their education if they were wise. I chose to invest in my education. Id be Scary also if I thought I could compete with professionals without investing in my education. To each his own ya know.

Bennie,

You've briefly touched on an issue I've thought about for a long time and didn't really know how to explain it, however, now I think I can and I'd like your advice. It may even be one of the main reasons I've never got started.

If the investing method of choice for beginners with no money and no credit is to wholesale/assign contracts to more experienced investors... how would one get around this circumvention of the more experienced investors?

In other words, what protects me (and more importantly the earnest money that I may have to borrow) from writing an offer and not being able to get someone from my buyer's list to buy it within my 10 day inspection period, just so they can go the seller after 10 days and cut me out of the deal.

You mentioned in your post above that "The Scary Wholesaler" had been burned before because of doing the wholesale procedure incorrectly. What is the correct way of doing a wholesale deal so I can protect my earnest money and keep more experienced investors from just waiting until my contract expires?

Thanks in advance for everyone's time and response.

Hello Bennie,

I think you CAN be a "NEW YORK TIMES, BEST SELLING AUTHOR" if you write a book, comic or something. I always enjoy your post.

bytheway, remember I mentioned about two investors I met at the meeting, one of them happen to be a mother of my son's classmate. can you believe that!!!!
I had somewhat good dinner with other investors she knew last Friday.

Ofcourse I was sitting down looking this way, looking that way, and looking ahead --it was four of us---while these ladies were talking. as you know, I had nothing to talk about since I don't know anything. but it was good. at least I get to know different people in this field.

GOD BLESS!

Its many people here more experienced than myself, id be interested in hearing their input also. If I may share a few thoughts that come to mind based on my personal experience since you inquired.

I have been “The Scary Wholesaler” who winged and screwed up deals before, so I not only identify with “The Scary Wholesaler” but have learned the lessons from the awful experiences. I got wise enough to invest in the education I needed.

Its impossible for me to mention everything that needs to be done when wholesaling in this reply, but I will touch on what you asked. If I overlook something someone please bring it up. Bear with me please.

First thing I do is go on the MLX CHANGE, you’re going to have to make friends with a Realtor to get access to it. Then I do a simple search of the properties that sold for cash in the same area I’m THINKING on marketing to for sellers. The Exchange wont show you the buyers name but it will show you the address that sold and the terms. I cross reference that address with the City/County Assessor’s office to come up with the buyers name and mailing address. Some counties you will not be able to access such information online due to privacy acts enabled by local counties. That’s one of the most reliable ways I know to keep my buyers list fresh.

I then market to sellers in that area. One of the best ways that works good in my area is direct mail, however its many ways. When I go on appointment and get the property under contract I go with the longest allowable Inspection Contingency Period allowable by the seller.( which covers so much more than a property inspection).

With private owners I try to go 30 days but usually 20 days. On MLS Listed properties like REO’s Bank Owned forget 20 days, you lucky if you get 10 days, sometimes I have pushed it to 15 days. Remember if you do not go over your Inspection period and give written notice before you inspection period ends you will get your EMD back in most cases after you fill out the proper Release Agreement forms. Also the asset managers for the bank that signs the contract generally wont allow you to assign the contract. However, when I wholesale a bank Reo I always do it in a Land Trust (another topic)

If you have done your comps correctly using up to date data not from some unreliable web site thats not updated daily, then you will come to a reasonable FMV and ARV that will tell you where you need to buy it at in order to make it an attractive investment to your end buyer investor.

Serious experienced investors know a good deal when you present it and know that if they don’t pull the trigger there competition will. The key is to get it under contract for the right price so you can add your assignment fee and it will still be a great deal for your end buyer.

If im presented with a wholesale offer that meets my rehab criteria I could care less what the wholesaler assignment fee is as long as the numbers work for me. I am not looking to circumvent wholesalers because you don’t want to have a reputation like that. People will not want to work with investors like that.

However maybe some new investors or just cut throat investors don’t mind that reputation and don’t understand the toll it takes on their reputation.

Once again buy the property right and have a fresh buyers list in that area ready in the same price range and you will not have no one waiting for your contract to expire because it will sell with no problem.

As far as the seller trying to circumvent me, as soon as I have the contract signed I also have the seller sign the Memorandum of Contract and get it notarized all in the same sitting. I record the Memorandum of Contract which creates a cloud on the title if the seller tries to get slick and sell it from under me. I could upload a Memorandum or you can download one online but make sure your attorney overlook it to see if it meets all the requirements of your State or Locality.

On the buyer side I get the buyer to sign the contract between Them and I, along with an assignment addendum disclosing the assignment fee. Also, the buyer presents a NON REFUNDABLE CREDIT to the title company, which at least covers the EMD I opened up escrow with the seller. However, again check with your legal department to make sure you are in compliance within your locality. Just a few thoughts I wanted to share from my experience.

Bennie said
"I have been “The Scary Wholesaler” who winged and screwed up deals before, so I not only identify with “The Scary Wholesaler” but have learned the lessons from the awful experiences. I got wise enough to invest in the education I needed."

This is SO true.

Buyers list is a MUST have!

Thank you for your kindness. You, Karen and several others inspire me to continue to share, I sincerely appreciate that. I share from my failures and successes. I have so many stories and not enough time to share all of them. As long as im here I guess I could try to add some sought of value if possible while borrowing others wisdom. For so many years I never shared a thought on this site, so since I’m out of the closet no turning back now I guess lol.

A business mentor of mines named Billy told me years ago “Bennie I may as well teach you how to do this, do you know how much unshared experience is buried in the grave yard?” Then he charged me $2,000 lol. Billy was a Real Estate Rock star!

Congratulations on attending your 1st meeting, so many people wait years to go. Some never go or get started period. Believe it or not, I remember when I used to go to the REI Meetings and said nothing also. I was “The Scary Wholesaler and The Terrified Buyer” lol

Bennie,

We all want to know what happened to

""Coming soon…. "The Scary Wholesaler Meets My Terrified Buyer”"

can't wait!!

Just keep reading Dean's books and anything you can get your hands on. Keep coming to this site and reading posts. Go back into the archives. There is a lot of good stuff there. Find a local REI club and go to as many meetings as you can. You will begin to absorb it all. Your fate will be sealed. You will be addicted as so many of us are.

It won't be anytime until you will be able to hold your own and contribute when you go to those meetings.

I wish you the best!

Karen

I agree with Karen, keep reading and learning. However at some point you’re going to have to pull that trigger. With you I know you will pull the trigger. It took me many years to pull the trigger, now I’m trigger happy lol haha omg.

Also I have an update with the scary buyer on this one coming soon. The buyer has backed out several times and this is scheduled to close either this Friday with my other closing or next week. When it close I will post it here.

Also "the Scary Wholesaler" is on track to gross in excess of $23,000 that he has told me about for the month of February so he is actually doing great stumbling along the way and learning the lessons like all of us.

Hello Karen,

Thank you so much for your encouragement. I hope one day I can become like some of you guys... yes, as you said I'll keep on check the posts and other good info from this site and learn.

also, thanks to Bennie that he directed me to find some local investors club near by and I have attended meeting as well.

Thanks again Karen.