Newbie Wholesaling Questions

[Chris Bluem]

Hey All,

As someone looking to get into wholesaling I have a some questions around a few topics in which I was hoping to get feedback, input and advice on.

To be clear, I am just starting, I have done research but I have not sent my first contract out, although I have found a few listings which I want to pursue with offers. My goal is to send out 3 offers by sunday, if not anything at least to get the ball rolling and start getting on the phone and following up and talking to people on the subject. I am located in South Florida.

Below are the topics:

Contracts: I have two blank contracts from local title companies, and I am currently just reviewing them to become very familiar. Do you all, on a normal basis, list any type of special contingencies/clauses to add extra protection in order to get out of the contract within the inspection period? Is there anything specific I need to really pay attention to outside of the inspection period on the contract?

Scripts: I have seen a few good BP post on WS calling scripts; however, it seemed that most of the posts were dated and didnt have the scripts any longer. Does anyone have scripts that they would not mind sharing to help me get familiar with how I should frame my services and the call?

MLS: I am curious as to what percent of your deals you get off the MLS. Before spending money on marketing, I want to learn the business better finding and working on deals from the MLS (so they are free), so that I can work out the kinks there and then add in direct mail.

Also, being new to the MLS and WS in general, it was easy to get overwhelmed with the amount of residences available, so I was curious as to what some of your strategies may be to help narrow the funnel when looking on the MLS (price point, neighborhood "grade", days listed, status changes, sqft, beds/baths).

Paid Mentor Programs: I am very interested in joining a paid mentor program, and I wanted to ask if anyone here has paid and had success in a mentor program before. I have looked at Wholesalers Inc, however they are based on direct mail and I would like to get the business down on the MLS prior to jumping into direct mail. I have reviewed the mentor section but it is a little all over the place so I wanted to ask in here to see if anyone has paid, and has had success in a paid program. (I know that I can learn everything for free in the BP forums, but for me it is worth the money for a little more hands on training, and more importantly speeding up the learning curve)

Thank you all very much for your time. My apologies for the long post; however I am very excited to hear your input.

[Jose Flores]

Hey @Chris Bluem 

Asking to cover a lot but I like the challenge. Let’s see how few words I can put all this. First, for a wholesaler the contract is an extreme important instrument to structure a wholesale deal. It is where you control the deposit you put up; communicates your “out clauses” to protect yourself (here is my out clauses “ This contract is subject to partner approval”) in the evident you can’t find an end buyer. It is where you communicate your need for access to the property. This is just to name a few. The point I want to drill home here is that it is all about control. My rule of thumb is that if I am making 5k or less on the deal I will use an assignment. If I am making over 5k I will use a simultaneous closing. Here are the benefits and drawbacks of each wholesale deal closing. If you are closing using an assignment the benefit is that there are no closing costs. The drawback is that the buyer knows exactly what you paid for the property and the seller know how much you are selling the property for. This may be a problem if the seller or buyer thinks you are making too much money on the deal. If you are closing using a simultaneous closing the benefit is the privacy that seller does not know what you are selling the house for and the buyer does not know what you bought the house for. The drawback of a simultaneous closing is that you will have to pay closing costs when you buy the house and closing costs when you sell the property. Second, scripts. I want you to think bigger than scripts. I want you to build systems. For example I have a phone script; a negotiations script; a checklist to prepare for my appointment to view the house; a checklist to estimate rehab costs that I bring with me to my appointments; and comparable analysis sheet to share with the owner. This is just a few examples to give you some ideas. Getting great deals is the result of preparation. Have every step you walk the home owner through calculated. This will in your confidence and make you seem very professional. I can share my scripts with you. Three, 95% of my deals are off market. That’s where all the hard work is and where all the rewards are. To be a great wholesaler you must know how to find great deals and historical off market deals offer the largest profit margins. Start driving for dollars if you don’t want to start direct marketing. Four, narrow your search to areas where most of the cash traction’s are. Also, think about the highest performing schools. Last, mentor. I have friends who swear by mentors and that one person who you can learn from. But for me I never felt that way. I like learning from a lot of different people without the expectation that one person is going to take me under their wing. But no matter what your perspective is there are many ways to get that support and guidance you seek. Here are a couple of ways:

1. You don't need to meet someone to be mentored by them. When I was getting started and still to this day I am mentored by people I have never meet. Through books, memberships, and podcasts I gotten peoples' best thoughts and ideas. The best part is that they are there for you to review and revisit as much as you want.

2. Don't look for one look for many. Don't put so much pressure on one relationship. If you're only getting advice from person you're missing out on different points of view.

3. Be specific not vague. Ask very specific questions here on bigger pockets or else where and you will shorten your learning curve.

4. Earn respect and trust through action. If there is someone out there that you really want to learn from you have to be a devoted fan. So buy their books, join their programs, engage in their community.

5. Work your butt off. Hustle, problem solve, be resourceful, and be consistent.

I think that’s everything. Hope this helps.