What NOT to do as a wholesaler

Question

So there is this property I would like to buy that has been sitting for a while and looked like a dump.  I am a cash buyer and when I say I'm going to buy a property, I buy it. This is exactly what a wholesaler wants.  However, I have found that dealing with "some" wholesalers or those who claim to be wholesalers, is extremely frustrating.

Here's a situation I'm dealing with now.

I saw a property advertised on Craigslist.  There was no contact name, no company name, no phone number,  no link to the wholesaler's website. The text was similar to other ads online and the properties are owned by different people so I can make an educated guess it's a wholesaler.

Wholesaler tip:  Put a phone number and contact/company name in your ads!

I email the anonymous address on the Craiglist ad.  I ask a few questions about the property and when I can see it.  I get the words "Lockbox XXXX" with a lockbox code where the X's are.  That's it.  No answers to my questions, no offer to meet me at the property, nothing.   Not trying to get to know what type of properties I'm looking for.

Wholesaler tip:  Be more personal with your responses.  This buyer could bring you more business in the future.  You don't have to spend a ton of time on a more friendly response.

I go out to the property with my contractor and get an estimate.  I determine that this will be a good deal and want to buy the property.  I check Craigslist again to make sure the ad is still there (because I have no idea who I'm dealing with, no name, nothing) and the ad's still up, so I assume the property is available.  I email the anonymous wholesaler that I'm interested in buying the property.  So far no response.

Wholesaler tip:  Be responsive.  If you don't post a phone number, how are you going to get interested buyers to call you?  If you only post an email address, then check your email periodically.  You will lose sales where you ignore the interested buyer.

These are some reasons why wholesalers get a bad name.

Is the property still available?  I have no idea.  Don't know who posted the ads.  I have no phone number, so I can't call anyone.  I have no idea if the wholesaler even has any right to market the property.  They were able to give me a lockbox code and the property is not on the MLS, so that's a start.

Roy N. · Answer

@Dawn Anastasi

With a lack of response that significant, I'd make an effort to contact the owner directly ... if the "wholesaler" is unwilling to work any harder than that, s/he really doesn't deserve a slice.

Alternatively, it may be a scam and they sensed you know too much to be a mark?  {Though the lockbox would seem to indicate otherwise}.

Jay Hinrichs · Answer

@Dawn Anastasi  SCAM is my first thought if they do surface next thing you know is they don't want to go through escrow and give you a quit claim deed and you just lost your money.. but I know your much to experienced for that to happen.

I thought in WI you needed a RE licnese to sell even your own property.. I seem to recall getting egg on my face when I made the proclamation that there is no way in any state in the union that you could not sell FSBO if you owned it.. and I was summarily corrected that in your great state you cannot sell FSBO and need a real estate agent.. Is this correct or not?  if its correct then wholesaling is dead in that state

On the subject of wholesaling I agree 90% or more never do a deal don't know what they are doing and they waste your time but also their own time chasing some dream because someone on BP posted about making 10k on a wholesale deal.. LOL

Dawn Anastasi · Answer

I did find a phone number for the organization and left a message, as well as that prior email.  This property may be a lost cause, but I will keep trying.

Dawn Anastasi · Answer

Correct, I would not close unless it was through a title company and we ensure that everything is done properly.  A quit claim deed anyone can issue for any property ... it just means you transfer all of your ownership interest over to someone ... meaning, you could own nothing and you transfer all of nothing over to someone else.

Dawn Anastasi · Answer

Yes, it's owned by an organization but I was able to find an email address for a contact person with the organization, so I emailed.

Roy N. · Answer

@Dawn Anastasi

So, have you pulled the owner's contact information from the tax account and contacted them?

Dawn Anastasi · Answer

There are wholesalers I have emailed or called who have not called me back. Or those that ask for my buying criteria and then disappear. I think most people that brand themselves as wholesalers don't know what they are doing and probably will never do a deal.

Stephen Nicholson · Answer

it seems strange that a wholesaler would go to the effort of finding the property and putting it under contract, and then just giving up on the business. Have you experienced similar with other wholesalers?

Jeff B. · Answer

Have you heard of a "straw man"?  Some adverts are just to draw interest, but usually they make themselves more accessible.  aka  baiting.

I've see this in used cars too - - find online, call to verify they have the car and yet when you get to the lot, "Oh that was just sold".

What NOT to do as a wholesaler

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