Struggles with the Stigma Against Wholesalers

[Jimmy O'Connor]

Hey BP Community!

I work in Philadelphia and Delaware County as a Licensed agent that specializes in wholesale for REI opportunities. As I have been reaching out to potential investors and doing the cold call grind (like many of you are probably all too familiar with), I keep getting pushback when I say "wholesaler." Over the phone I find it difficult to differentiate me from the people only looking to make a quick buck because some Youtube Personality says they can do it with 5 simple steps. I personally have, and continue to thrive off of repeat investors but I am always looking to grow my network of relationships.

So for all of my wholesalers and investors out there~

Legitimate Wholesalers- have any of you experienced this dilemma and what has your solution been to establish legitimacy in a time where our profession is being too loosely equated to the "get rich quick" mentality rather than

Investors-

What are some of the pain points that you have run into with wholesalers? What can I focus on with my quick pitch to establish value that differentiates me from the wholesalers that have left a bad taste in your mouth?

[James Masotti]

@Jimmy O'Connor - Wholesaling is perhaps the hardest job in real estate investing and it's where most newbies think they can get started. Unfortunately the majority of them are completely wrong. It is hard for the following reasons.

1. You need to know what the ARV is for your target market and how to actually comp properties appropriately
2. You need to know what rehab costs are in order to estimate the amount of work needed for a property
3. You need to be good at marketing in order to be able to find the off market deals
4. You need to be good at negotiating in order to be able to win investors and sellers alike

So...why do most investors get annoyed at wholesalers? Because they bring me a deal and claim it's worth $150,000 when in reality it's only worth $120,000. They tell me it needs light rehab of about $15,000...when in reality in needs $30,000. They do all this and tell me I can "steal" the property from the seller for only $90,000 plus of course their $10,000 fee. 

It's a waste of my time and the sellers. So how do you improve your "quick pitch"...the simple answer is you don't. The deal is what we're interested in. All the newbie wholesalers who are like "I'm trying to build my buyers list give me your email!" That's just spam at that point. Your system isn't any different than anyone else.

 The deal is what sells us on you as a wholesaler. Most of the "good" wholesalers have only a handful of investors they work with because if you bring me a deal that meets my criteria, I'm going to close. You don't need to shop it around...and that's the mutually beneficial relationship everyone is looking for, that very few people are actually able to deliver on.

I will listen to any wholesaler who comes to me on the first deal. When they prove they know their stuff, I'll listen and keep listening...when they are clueless though I know not to bother wasting any more of anyone else's time because they'll eventually run out of marketing dollars and disappear.

::steps down from soap box. ::