Wanting to be a good wholesaler

[Elisha Mcginley]

So, right now, I'm new to the game and I'm in the planning phase. I think it's a good idea to begin in wholesaling so I can get some good hands-on experience of the market and build a network. I've been doing a bit of research, and I have plenty more to do, but I have some inquiries I'm hoping someone can help me with. From my understanding, the basic process is: I. Meet a few serious buyers and ask them some questions to find out what they are specifically looking for, so I know what I'm looking for and who to call once I find it. II. Begin marketing to find the deals I am looking for in accordance with my buyers' criteria. • question: 1. When I get calls from sellers, how do I know which deals are worth looking into further and which are not worth my time? What specific information do I need to gather from the seller? 2. Should I get comps at this stage for ARV? 3. Should I contact a general contractor at this stage and have them accompany me to meet with the seller? III. Meet with the potential seller at the property in question and discuss their situation. •questions: 1. Should I crunch the numbers during our meeting and make an offer, or should I go home, crunch the numbers, gather data, then call them back with the offer? IV. Make the offer and negotiate with the seller. V. Sign the contract with seller. VI. Meet with buyer(s) with a complete report of the offer and negotiate. VII. Sign the contract with buyer. Any additional suggestions would be appreciated. Thanks!

[Adrienne Bryson]

I agree with Diedrick I wouldn't worry too much about getting a buyer's list first per say...  I did both sort of simultaneously, searched for both qualified leads and serious buyers at the same time.

I can only speak for myself and say that I am a novice so just take my word with a grain of salt. But I have a spreadsheet for my leads with relevant info that I try to have filled in before a potential seller calls. That way as soon as I answer and get their name, I can open my spreadsheet and see which house it is, bed/bath/sqft, neighborhood, built/renovation date, owner address (to know if O/O or absentee), if it's SFR/MFR/Condo, my estimated ARV, when I sent the letter to them/how many letters I've sent to them, and the general condition of the house from what I could see and find online. All this info by going to my county tax assessor website and sites like realtor.com and redfin for house info and value estimates, takes me about a minute per lead to get it all. I also have a separate sheet for each list, so I can tailor the conversation accordingly.

Having that info at my fingertips has saved me a lot of time when I actually do get a call, because I don't have to sit there and waste 20 minutes with "what's the address, how many bedrooms, how old is the house, do you live there" blah blah.  I can just ask a couple of open ended questions ("tell me a little about the house" to which the response usually includes if/when improvements were made, why they like/dislike the house, and if they owe a lot on it... and "what are your reasons for wanting to sell" to which the response usually includes their motivation and how much they're looking to get).  At that point we're only 5-10 minutes into the conversation, and the seller feels like we're having a friendly chat rather than an interview/interrogation.

I end the conversation by setting up a time to see the house. Since I already have most of the info, I don't need much time to gather intel. I can actually set a time within a couple hours to meet, which if you ask any salesperson the quicker you move the more likely you are to close. I take a few minutes to calculate my MAO from the ARV I already have, the usual assumptions for cleaning paint etc, and the info I got from the seller, and jot it down in my notebook, which I take with me to the meeting.

Then all that's left is to meet, go through the house and take note of anything that wasn't discussed on the phone (like cracked outlet covers, clogged gutters, faded siding, etc) and jot everything down in my notebook. By the time we sit down to talk I've already recalculated my MAO and we start negotiating on the spot.

I have not used a contractor at this point, however like I said I am still a beginner and I do plan to actually start getting inspections for each property I get under contract before passing them on to my end buyer.  Having read J Scott's book on estimating rehab costs I feel confident and informed enough to go in without a contractor.