Updated about 10 years ago on . Most recent reply
$35K profit double assignment
Recently, another investor that I have done tons of business with over the years called me because he came across a house that he knew I would like. Up and coming neighborhood that I knew really well, multi family that needed work. Fit exactly what I like to buy, fix, and keep. He and I meet the seller who lives in the property, and we negotiate the price. $75k. This investor tells me that he will assign to me for $10K which we have done a number of times together.
Because I have the absolute worst luck of all time, 2 other houses that were bank deals that I had been working on for months finally call and say that we need to close in 30 days. These other houses are in a city where I can get the same rents, but a better tax rate. Only thing, this up and coming neighborhood as wildly appreciating values. So, I make the hard decision to get a piece of something instead of all of nothing. It really killed me not to keep this property, but the handshake agreement that my buddy and I had became an assignment where I cut him a check for $10K, and now he was out of the deal.
I then contacted an agent that I work with extensively and told her to create some buzz about this property and that we were looking to wholesale it and fast. She couldn't legally list it, but she could talk to contacts and let them know what was coming available. Once we had enough interest, I had every single investor show up at the house at the same time and told them the property was for sale for $50,000 and that they had to close in 10 days. Make your highest and best, because if we need to close on this thing, they can fight over it like a piece of meat once it hits the MLS.
Long story short. Very profitable bidding war. I Signed the second assignment for $120,000 and let the end buyer close on the property. Walked with $35,000 and that funded a large chunk of my rehab on one of the other two properties that I later closed on.
Most Popular Reply
Bill has a lot of experience in real estate and is not unafraid to share his experience with others. I respect his opinions in this area.
The challenge I have with being so anti-wholsale is that many professional real estate agents will never touch the house you described. And so a lot of these folks will do nothing or will FSBO. And they likely wouldn't get as much as you offered.
Anyway, you asked for comments by sharing your post. And I'd say you got them...
You should really ask @Karl Krentzel for his opinion... :)
If he and Bill debated on CSPAN, I'm pretty sure the ratings would be higher than anything CNN or FoxNews would get this election season!