What is the best way to get started with Wholesaling

Question

Unemployed. Plenty of time.
                    
                    Skills:
                    * Excellent web research skills
                    
                    * Know how to locate Pre-foreclosures using Public Records and foreclosure websites.
                    
                    * I know where to find Tax Assessors, Mortgage Information and Comparables using Zillow, Trulia and other websites.
                    
                    * I have a good understanding of how to get properties under contract but I have no income, no business startup capital and no transportation at this time. 
                    
                    * How can I get started in this business?  R.E.I. Clubs are not doable at this time due to finances.
                    
                    I am fascinated with this business and cannot rest on the idea of waiting for a Job to show up in this depressed economy.
                    
                    I would think that these skills would be a help to someone and I could locate properties near my area.
                    
                    I have contacts who provide Mortgages and Funding for Commercial properties but this does not seem to be helping any either.
                    
                    Craigslist is DEAD lately, especially for Retail Buyers of homes. I post and I get those DAMN spammers and that is it.
                    
                    I cannot try to raise funds unless I form a business. Am I right on this?
                    
                    Any tips are welcome.
                    
                    I want to get in now while the Real Estate market is still HOT.

Kyle King · Answer

Robert,

I was unsure of your background and whether you had done ANY deals in real estate, so I'm assuming that you are NEW.

If you are bound and determined to spend all your day working in real estate and truely find yourself addicted to the 'dealmaking' of the this business. ( I speak from experience. Made  the fulltime commitment in 2003.) Then consider these suggestions.

1. Use BiggerPockets every day.  It is FREE and is like a college library.  If you ask the right question and do your homework, you will find answers and get results.

2. GURU knowledge. If you have $50-200 to invest in yourself, get Carlton Sheet's RE cd.s.  They are not perfect but if you are NEW, they are a wealth of information and can be bought on Craigslist or Ebay for cheap. great for the car.  Always be learning.

3. Find a local MENTOR.   Find someone local that needs help (emails, research, etc.) and call them at least 2x daily (early AM and late PM).  If they are active in the market and you offer your time and energy, they will teach you just by including you in their daily activities.  Find a mentor.   I built a small developing company via a 3 mth training with someone here in Dallas. Within 12 mths, I was developing $4 million in new townhomes and flipping $2 mill. in land on the side.

4. Flip your way to success.  If you can find good cheap deals, you can flip for min $2k per home. There are always buyers, if the deal is right.  Flip first, get some cash...then worry about owning and doing partner deals.   You need to establish yourself first.

I hope this helps. I started in wholesaling and still do a few SFHs a year.  Recently, I've started wholesaling commercial properties.  If takes time and experience.

Good luck.

Kyle

Ryan Webber · Answer

I've said this before and I'll say it again.  If I knew nothing about wholesaling and wanted to get started in it, I would take a week or whatever and read EVERY post in the entire Wholesaling Section here on BP.

There is a wealth of information here for FREE.

USE IT!!!!!!!!!!!!!!!!

With that said, I would actually recommend you get a minimum wage job to pay for some transportation.  You need transportation.  Riding up to the house on your bike isn't going to go over well with a seller.

The market is HOT?  It was hot 4 years ago.  Now its actually cold, ice cold.  Actually if you are looking at it historically, its probably the coldest its ever been since the Great Depression. Not that its lack of temperature eliminates opportunities, but don't fall into that whole illusion of the "right" time to get in.  There are always opportunities if you know where to look and what to look for.

Ryan Webber · Answer

The market IS cold because real estate sales are dramatically down across the country.  The market IS cold because my city was recently in the top 20 appreciating markets in the country with a forecasted 1% appreciation (that's 1.0% appreciation).  The market IS cold because lenders are tighter than they've been in 20 years.

The market we are in is what we call a "cold" market.

Does that mean that there aren't opportunities around every corner? NO!!!!!!!  But that doesn't make the market hot.  The market was hot 3 years ago when all you needed to make money in many markets was wait 3 months and resell the same exact house you just bought and you would clear $20,000 profit with 5 offers on the first day.  The market was hot when anyone who could fog a mirror could get a home loan if they didn't own a house and a HELOC if they did.

The temperature of the market is the level of activity in the market.  A hot market has more activity, more sales, and a lower inventory.  There is lots of movement.  A cold market has lower activity, lower sales, and a higher inventory.  There is not much movement.

Again, the market being cold does not mean that there aren't opportunities.  They just aren't as obvious as they used to be.  If people are still buying houses in a market then there's always opportunity.  In ANY market.  Hot or cold.

Curious, if the market is hot now, what do you call it 3 years ago?  We saw one of the greatest real estate booms in our country's history along with one of its greatest busts (which we are still in).  I just don't get the logic behind the argument of it being hot.  What exactly is a cold market then?  Again, temperature not being availability of opportunity but movement in the market.

Even looking at opportunity, there is an increase in opportunities in some ways but in others there are dramatic tightenings (i.e. financing).  Try to go get a no money down loan right now from a bank as an investor or even as a homeowner.  It will be a big NO.  Yet three years ago, EVERYBODY was getting them.  It was almost unfashionable to put money down.  You actually have to have a down payment now to buy a house.  What a concept.

I'm all for being excited about what you are doing, but trying to sike yourself up to get into the market while its still hot is just plain stupid in my opinion.  The hot market ship sailed.  The only ship left is the "work your butt off" ship.  Take it or leave it.

Jeff Tumbarello · Answer

If you want to become an REI investor because you spend more money than you make, there is no fix for that. If you have no cash, bad credit and no net worth. You should fix you first them invest in real estate. 90 percent of the people in this game do not understand the difference between investing and retailing real estate The smart ones in this game invest in income.

It is and it is not a great time to try and become a wholesale investor. It depends upon your market. If you are in a high foreclosure market like SWFl. The bankers are the only ones creating equity.

You do not need any course and any Guru type mentor. The problem with Guru's in 99 percent of them give the other 1 percent a bad name.

You need the following to wholesale.

1. Keen market knowledge. Most newbie's have no idea about values. Pick your farm market. and drive nothing but CLOSED SALES. the only sale that matters in real estate is a closed one. the rest are dreams that may or may not come true.
2. Marketing to get sellers to call you
3. the legal document to gain you an " equitable, executable interest in the property.
4. Marketing to get buyers to call you.

I bet you could do all that in style for 5 to15K and really be what you want to be. or you could give your 5 to 15K to some guru who preys on others dreams, not the real estate market.

You should probably look into getting a real state license. Almost all of the real investors I know have an RE license. The disclosure in very simple. The access to data and trends in priceless. Most Guru's will steer you clear of that. WHY? Because they do not want you find out they are full of Sh&T. I am not telling you to be a rank and file realtor. An Investor with a real estate licenses has inherent advantages that the unlicensed does not.

Michael Perry · Answer

Find something else to do...that is what I recommend.

This is not a great time to get into this business...particularly if you are broke.

Even people with good REI skillsets and access to capital are having a tough go of it now.

But if you decide to jump in, do yourself a favor and bring sufficient capital to fund your endeavors or get under the wing of someone who has some "getting around money". Don't join the legions of pests who just get in the way.....

Merry Christmas!

Michael Perry · Answer

Watch out for the REI cultists too, Robert. Once they get on you,they propagate like fleas on the posterior of a mangy dog...

LeJon Ratchford · Answer

I disagree with the statement of the market being cold, I would say that is a matter of opinion. There are plenty of whole sell opportunities available. I found 10 today and will have them under contract soon for $10, I will achieve this using a flex option contract.

I agree, read the forums this place is like going to Harvard for free it is one of a kind. If you have problems speaking with professionals, practice. Call ask questions, answer questions, be polite.

Learn how to find buyers
 and find clients by searching the forums also. As far as not having transportation, find deals for other whole sellers. Explain your situation to them, ask if you find the deal would they be willing to show the houses for you, splitting the profits maybe 60/40 split (they are doing you a favor). Maybe ask some one to drive you to properties, explain to you clients that your transportation is a student of yours  or something of that nature and let them stand around while you do the talking. Be creative, you can do it, I wish you the best.
LeJonR

William S · Answer

There is very little you can't learn right here on this forum. Even if you have little or no experience. Spend time here. Scroll through all the topics and pick the ones that interest you. This will lead you to more question and answers you can find or simply ask.

Save your money on courses for now and instead invest some time here first

Will

Aly W. · Answer

Well said, Ryan!

Bill Gulley · Answer

Hi, Jeff your post is right on! If one studies guru tricks, that's all they get to do. Anyone can buy college level real estate text books on Ebay along with Wests  business law text book. It really doesn't matter what the market is, there is always opportunity in real estate. Bill

What is the best way to get started with Wholesaling

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