Your thoughts on this strategy...

[Derek T.]

It seems as though some of the best deals are with investors that deal directly with home owners. I think I know myself pretty well and this is not an area I am interested in or will probably excel at.

With that being said, I was wondering how I can take advantage of some of those deals without personally interacting with the owners themselves. So I was thinking about getting in contact with the listing agents of the big investors who are marketing directly with home owners and see if they were willing to wholesale their deals. Essentially a listing agent with list one of these short sales on the MLS to get the process started with the bank, I contact them and ask if their investor is willing to wholesale the deal, the listing agent gets an extra $1500 referral fee from me, and then the other investor gets a top wholesale fee without having to the rehab and deal with all of the issues associated.

I think it would be a win-win-win for all parties if the investor is interested. The listing is probably only getting a small fee to list the property so this drastically increases their money earned, the investor gets a great wholesale fee, and I get the house and a good deal (and get to cherry pick which deals I want). What are your thoughts on it?

BTW it has worked with one property so far and we are lined up hopefully for a March closing. I contacted a LA who put me in contact with the investor (after I told the LA I woukd give a $2500 referral fee), the investor was interested and we agreed on a price and now his guy is working the ss. I guess I am wondering (a) if I am missing something and (b) if there is a reason why I can't do this many times over?

[Mike Neubauer]

Just be careful. It's not an issue of figuring out how to get around the rules. There are always ways around it. The problem is fraud is defined as knowing deception. Even though you can just transfer the llc to the new buyer and the deed won't change names, a judge may say that you knowingly set up that plan to deceive the bank.

Realistically, if you are only doing a few, it probably will never come up. However, it takes just one time to ruin all you have. Take a look at some mortgage fraud news stories. These people just "bended" the rules. But, in some cases the judge said that bending was worth some time in jail and hefty fees.