My Grand Forks Real Estate Wholesale Deals

[Layton Erickson]

Hello, 

Here is another deal and this wasn't your typical wholesale deal. I received a call from a seller in their mid 80's in October. I along with my partner toured the property, (my partner is an experienced flipper that basically buys the deals from me). The seller wanted to sell the place so they could 1031 exchange the proceeds from the deal tax free into a lake home in Bemidji. It was a triplex with a basement apartment. Everything about the place was old but it was a rental so it would be just fine for the rental market as long as the windows, siding and a little interior work was done.

The seller told us what the rent was and we thought the price he wanted was a great deal! It took several months of staying in touch with the seller until they identified their property in Bemidji they wanted. Then we would be able to buy the property after that. 

We did run into a few bumps in the road though. When my partner closed on the property, we found out that the seller lied about what he was getting for rent, expected life on capital expenditures and I didn't get my wholesale fee until mid March because of the way the contract was set up. 

I learned that you need to put everything in writing because even the people that seem the most trustworthy can still be unethical. Also I learned that you need to verify the #'s even if the seller tells you his #'s.. you need to run your own #'s every time, no exceptions.