Wholesale Marketing to Acquire Buy & Hold Properties

[Evan Thomas]

The more I think about how I'd like to find a buy and hold property, the more sense it makes to market like a wholesaler. That way I can find the best deals with the lowest prices and (hopefully) The highest cash flow. But I have a few questions. 

1. Does anybody use this strategy of buying and holding deals they've found through motivated sellers or direct mail campaigns? How does it work for you?

2. If I wanted to market to sellers  that I would buy their house, but I would need a mortgage to do so, could I still persue this strategy? 

I know a lot of investors eventually come across deals like this just by being in the business (they know a guy who knows a guy who wants to sell his house), but I'd like to start my Real Estate Investing in this way. Any thoughts would be greatly appreciated. Thank you. 

[Jeff Rappaport]

@Evan Thomas, Not only is it a good idea but a great idea!  The best deals are found off market and by marketing to these people you can find some great deals!  I am mostly a wholesaler (although I will keep the ones that fit my criteria) and I sell a bunch of properties to investors that are looking for buy/hold opportunities.  There is no problem needing a mortgage except you may not want to advertise that you can close in 30 days or less.  

I market to absentee owners, owner occupied, multi-family, vacants houses, high equity and little equity.  It really depends on what you are trying to accomplish.  I create multiple offers to just about every lead I speak with and get a number of properties with owner financing.  If I can create great terms I can either sell my contract to another investor or keep it for myself.  Just make sure if you are going to deal with any creative financing that you are clear about the many rules and guidelines you must follow.  

When I started in real estate back in 2000 all I did was find propeties I could take over "subject to" the mortgage with little to no money down and then I would rent to own them to a tenant/buyer.  I would collect a non-refundable option deposit from them up front, create a cash flow every month and if the tenant/buyer exercised their option down the road got paid again.  If they did not exercise their option then I had a buy/hold where my tenant was responsible for all utilities, maintenance and repairs.  All I had to do was collect the rent and watch my principle balance of the property go down every month.  

So, when you say you would need a loan from a bank to buy properties I would tell you to start educating yourself on the world of creative finance.  You might like it!