Finding off-market properties: Part 3- Wholesalers

[Kimberly Kesterke]

Wholesalers

Wholesalers are excellent resources. They are business owners whose sole purpose is to find and sell investment properties. They can dig up incredible deals that are then passed on to you. The way they make money is through their negotiation power. They negotiate a deal that provides a spread between what the seller is willing to accept and what the investor is willing to pay. This spread is the money they make and is usually referred to as the “assignment fee”. The better negotiators they are, the more money they make, while still passing on an awesome deal to you.

Keep in mind that their assignment fee covers a variety of costs they incur on the front end before ever closing a deal. It covers costs to mail out postcards or letters, it covers their costs to acquire a list, and their time dedicated to taking calls, negotiating the deal and building their buyer’s list. Using wholesalers allows you as an investor to save time, effort and money in exchange for a small assignment fee. Using the right wholesaler can be a win-win- You get a good deal, and they make a profit.

Networking with wholesalers can be a good way to find your next rental property because wholesalers do the heavy lifting for you. From driving for dollars, to sending out postcards, to networking with their local community- the right ones have their finger on the pulse of off-market properties.

So how can you find these magical service providers who do all the heavy lifting for you???

Facebook Groups

There are hundreds of thousands of real estate investing groups on Facebook. All you would have to do is join a few in your market of interest and post you are looking for someone. You can even search the group archives with the keyword, “wholesaler” and get a pretty good list of people you can contact.

Google Search

The more professional and experienced wholesalers will have websites that are tagged and archived on Google. Just search “ property wholesaler, (insert territory here)” and sift through the results. Many websites have the option to add your e-mail address to their list. It may not hurt to give them a call directly and let them know what you are looking for.

Local REIA- (Real estate investing association)

Every State has a variety of REIAs- pick one and start going regularly. Find the meetings that specifically discuss deals and opportunities. My local REIA calls it the "Dealmakers" meeting and they even have a google group that sends out email notifications. Most of the time, the notifications are coming from wholesalers.

As you can imagine, Wholesalers are not all created equal. You are going to have some excellent ones who are true professionals- they treat their services as a business. You will also find ones who are just trying to make a quick buck.

Either one can be fine to work with if the deal is structured properly, however, you have a better economical exchange using the professional. The following is criteria on how to find the better ones:

• Do they have a website?
• Do they have testimonials on that website?
• Are they responsive when you call them?
• Did they come recommended from a happy investor?

In wrapping up- wholesalers can be a great resource for you in finding off-market properties. They do the heavy lifting for you, are networked within your investing territory and will have a lot of insights to which areas are the best to invest.

What are some other ways you have found or networked with wholesalers? Any tips on how to properly vet out a wholesaler to ensure they are a good one?