The Ultimate Beginners Guide to Virtual Wholesaling

Drivers license suspensions can bring out the resourcefulness in people. While serving a 6-month suspension for a non-traffic violation, I made many changes in my life, one of these changes was making my wholesale business 100% virtual.

The idea of never having to leave the comfort of your warm bed while watching the number of zeros in your checking account increase is a fantasy that many in today's world subscribe to. This was in no way the fantasy that I had envisioned when I started wholesaling. I wanted to be THE guy. That guy who walked into a property looking like something out of the show Ballers and drove home in his BMW to his trophy wife in the Hills. That was the antithesis of my reality during that 6-month suspension. My typical day consisted of laying in bed till 2 pm with my MacBook, dog, and a cup of coffee. Although that might seem lazy to most, the amount of hustle I brought to the table, was showing itself in the number of zeros in my bank account.

Okay, enough of my story. You want to learn how to wholesale 100% virtually.

1. Systems

The concept of establishing systems is preached here at BiggerPockets. I cannot stress enough the power and importance of systems. Doing anything virtually requires a certain amount of intimacy with technology. There are systems that I use on a daily basis in order to run my business:

• Zillow:

The For Sale by Owner selection in Zillow might be the most overlooked and underappreciated form of lead generation. It also does not hurt that it is 100% FREE! My lead generation is upwards of 95% FSBO on Zillow. There are other websites that allow For Sale by Owner listings, but what sets Zillow apart is the “Zestimate” technology. I know, it's very controversial and, at times, wildly inaccurate. Although, in populous markets across the United States, the “Zestimate” is an extremely efficient tool for establishing an After Repair Value. In wholesaling, establishing an accurate ARV is the key to the success of the deal. It is how one established a Maximum Acceptable Offer (MAO).

• GoogleVoice:

I am all about free. Google Voice, by no means, is the most advanced VoIP system out there. Compared to others, it is almost primitive, but I don't think that the simplistic nature of Google Voice is necessarily a bad thing. It gives you a free number in any area code in the country that you wish. It gives you the ability to text and call from your cell phone or computer, what more does one need.

• Google Sheets:

I feel as though one could hypothetically run an entire company off of Google products. I use Google Sheets (spreadsheet processor) for my customer-relationship manager (CRM) functions. There are many websites that offer free templates for Google Sheets that are tailored towards wholesalers. All I need is an efficient way to store and organize information from the leads that I pursue.

• SignNow:

If you haven’t noticed, I am cheap with a capital “C”. The only system that I pay for is SignNow. This system allows me to sign and get signatures from sellers, other wholesalers, and buyers remotely. It’s $7.00/month which is very inexpensive for a program like this. If you want to splurge and buy the "Rolls-Royce" of virtual signature platforms, look no further than DocuSign.

2. Step-by-Step

So now you know what systems that I am using. I cannot stress the importance of those 4 products and the implications that they have on success in doing this business virtually. Now here is the bread and butter….how I do this thing.

1. NETWORK!

The key to successful virtual wholesaling is having someone else on the ground for you. That someone needs to be a wholesaler (preferably a good one) in the market that you are targeting. BiggerPockets is a great way to find wholesalers in whatever market that you are looking for. I have never encountered a wholesaler that has been opposed to working with me. I offer a 60/40 split in my favor for the terms of our joint venture. I bring him a contract on a house in the market in which he has buyers in. He or she signs the Purchase & Sales Agreement, handles the assignment part of the process, and shows up to closing. It’s that simple. If the assignment fee is $10,000, I get a check for $6,000 and he gets a check for $4,000.

2. Making a “blind offer”

This was scary for me at first, then I realized that I didn’t know what I was estimating to begin with! I always had to rely on my negotiation skills in order to compensate for my shortcoming in the field of estimating rehab costs. Lately, I have been using a formula that estimates a rehab cost per square foot depending on the classification of the property (the Good, the Bad, and the Ugly). I anticipate some heat for this practice, but so far, my estimates have not been far off from what the experts estimate. If the property is a once in a decade type of opportunity, I suggest asking your wholesaler to go take a look at it for you. So the formula for making that offer is [Zestimate (ARV) x 70%]-rehab costs-assignment fee. Sometimes that offer can be half of what the initial asking price for the property is. As Brandon Turner always says (I think it was him), “If you are not embarrassed by your offer, you offered too much.”

3. Signing the Purchase & Sales Agreement

This is the part of the process that truly makes it virtual. Using SignNow, I am able to draft a Purchase & Sales Agreement and have my wholesaler sign as a representative of my company. He takes the contract and is able to market it like any other contract. When he or she finds a buyer, they handle the closing process so that I never need to leave my bed.

4. Collect that Check!

You have done your job. Your wholesaler has completed the deal and it is now time to get paid. I have a clause in my joint venture agreement that gives my wholesaler 48 hours to get me my money or it's a $2,000 fine. Luckily, I have never had to enforce that penalty on anyone. So you’ve got your money, it’s up to you on how you want to spend it!

I hope that I was able to offer a practical guide to virtual wholesaling. I find no greater joy than to help other people find the liberating feeling of wholesaling virtually. Thank you all!