Beginner looking to wholesale REOs in Houston. So many questions!

[Gabriela Martinez]

Hi everyone! Okay bear with me. This is a long one.. And my first post on here.

I'm a new wholesaler. I've been studying how to wholesale absentee owner homes in hot areas. However, on my way home from work, I started googling REO properties and found an amazing deal. The online auction will begin in 3 days and ends in 5 days. It is an incredible deal (for myself and the investor) even if the price increases by 200k. It's in a great area, homes are being sold for $185k-442k ranging from gutted homes to entirely remodeled beautiful homes. Current homes in that area are being listed for $179k-$1429k.

I understand wholesaling foreclosed homes is a whole other ball game. I've read that you would have to already be partnered with an all cash buyer, you can't assign a contract to the cash buyer, need to show POF, put in earnest/buyer's premium, close the contract under your name to then be able to immediately resell to cash buyer. Right? Wrong? I'm desperate to understand the entire process. I'm so motivated to wholesale reo properties (possibly not this one since I do need to do more research).

They are asking for an Earnest Money Deposit of 5% of the Total Purchase Price or $2,500 (whichever is greater). Will I be paying this or will my transactional lender/cash buyer pay this? They also state “A Buyer's Premium equal to 5% of the Winning Bid Amount or $2,500 (whichever is greater) will be added to all Winning Bid amounts to determine the Total Purchase Price.” Again, will I be the one paying this? I do not have $2,500, so if that’s the case I’m out.

What contracts are needed, could I ask an investor friendly title company for some guidance or is that a no go?

Tips and advice would truly be appreciated! Even if this deal doesn’t work out, I’m determined to wholesale an reo property this year.

I will be using all tips and advice as guidance to do more of my own due diligence until the time is right for me to close my first wholesaling deal. Thank you for your time!