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All Forum Posts by: Adam Macias

Adam Macias has started 9 posts and replied 143 times.

Post: Wholesaling in the DMV

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84
Quote from @Jerran Crichton:

@Adam Macias thank you. I have other questions, I'll DM you.


 No problem! I'll help the best I can.

Post: Wholesaling in the DMV

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84
Quote from @Jerran Crichton:

Does wholesaling work in the DMV? 


 Wholesaling works in every state in the country.

Post: Wholesaling With Conventional Loans

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84
Quote from @Jesse LeBlanc:

@Adam Macias Yes, both of my original long posts stated exactly what you just said in your last post. I agree, hints why I was trying to help others have the smoothest and easiest closing without double closing while explaining many what if's that could happen and ways around those hurdles.  You're still stuck on me being a lender for some reason and not respecting the entire educational post for others.  Oh yah, 100% agree about the end buyer, I also stated that in my original posts, don't work with someone like this.  Find folks you can have a mutually beneficial and long term relationship with.


 And I mean at the end of the day, this is just my take and opinion. I understand my way of doing things won't be for everyone. There are states that don't allow assignments at all and if it ever got that way in states I do business in then yes double closings are absolutely necessary. There is great value with transactional funding for people doing business in those states. It all just depends. I'd just rather avoid it at all costs given assignability exist and as long as this is the United States of America and contracts mean something, it will.

Post: Wholesaling With Conventional Loans

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84
Quote from @Jesse LeBlanc:

@Adam Macias you clearly misunderstood and making assumptions now.

1) I never said you were a newbie nor would I care if you were.  Facts are facts
2) I specifically stated NOT to double close and methods to get around it
3) I also specifically stated that someone should be very transparent so there should never be any concern with your buyer or seller and not to double close, especially in this scenario (for MOST cases, especially if you didn't talk with the buyers lender ahead of time)
4) Everyone who reads this post SHOULD review both of my longer posts above, new or experienced, to understand the process more and step by step vs just your comment without explanation stating "biggest thing people need to understand is that 99% of the time a seller is not concerned, cares or even knows what an assignment fee is"  as there is more to that especially for a rookie.  They don't know what that means.  That also doesn't help or answer the question to the original post, may have nothing to do with the seller but 100% will potentially have an issue with the end buyers lender and losing the deal completely. 

I'm focused on adding value and explaining the process, the why and the what if. :)


 Not making assumptions, stated my viewpoint on the topic.


What did you mean by, "and otherwise hiding your fee from someone". Hiding is an interesting word because according to the dictionary it means:

the action of concealing someone or something.

  • the state of being hidden."the shipowner had gone into hiding"

Further "concealing" means:

keep (something) secret; prevent from being known or noticed.

So what I'm implying, not assuming, for anyone reading this conversation is there's no malice if the seller's doesn't know, see or understand what your assignment fee is.

Did this provide enough clarity or did I misdefine my intentions?

Because you also said, "your seller is fine with what you made". Well, what makes you think they wouldn't be fine unless you think you're doing something wrong? I don't need the double closing process explained because I've done them before.

Three biggest flaws with them for me are:

1. You place more earnest money than necessary most of the time and it comes from you, not your end buyer which is tough for most beginners in wholesaling to consistently risk that.
2. You lose more in your profit because of fees from the transactional lending.
3. It takes more effort because you literally have two closings.

This is nothing against you personally and I'm not saying transactional lending is never going to be necessary. Also, I remember when Colorado omitted the assignability clause in the state contract 10 years ago. That's when this type of lending became popular. People were freaking out because MLS deals were so easy. Man that was a fun time though.

Also, "have a buyer that is greedy and upset with your profit and could walk away", if this is the case don't work with that buyer then. Work with people you'll have a long term relationship with that want to see you win as well.

Post: Wholesaling With Conventional Loans

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84
Quote from @Jesse LeBlanc:

@Lydia R. completely understand your concern, and as I said before it's case by case depending on ones relationship with each party.  At the end of the day, there should be no reason lie or deceive anyone to get a deal closed, and not saying you or I am but I know so many others intentionally lie to sellers to get a deal under contract. 

There are a few ways to protect yourself and make sure you still collect your fee, one is as simple as being the one facilitating the contract to both seller and buyer.  In the special stipulations BEFORE you send to your seller and buyer is that you write in that X amount is owed to you and to be shown on the sellers side.  It's as simple as that.  Then when both your buyer and seller sign the contract and you send to the closing company, there are no questions asked, you're protected and you get your money at closing and the end buyers lender can't say anything about it plus they won't know what the actual contract said anyway.  @Adam Macias the above paragraph answers your question about security and making sure you get your $

If your seller has a problem with your fee, then you clearly didn't have a good relationship or not transparent with the seller and you didn't set proper expectations from the start, thus causing a potential surprise later.  I know what you're thinking right now, what if the spread was such a huge amount.  If you then feel that to be the case, no need to lie, just find a 2nd option to still be able to close the deal, which might be to buy the property with your own capital, with private money or hard money then as soon as you own it and on the deed get an UPDATED contract with the end buyer now that you are legally the owner and have the right to sell and there won't be a problem with the conventional lender.

ALSO, i'm NOT saying that this is for EVERY lender either.  Hints why my original message stated to communicate with the buyer and their lender as MANY of them don't have a problem still lending once they know what you're doing and that you will legally be the owner at the time of the BC closing.  Once they understand that, then you should be perfectly find double closing without a hitch, BUT you want to know that first vs waiting until the day of closing and the underwriter realizes you aren't the owner and they stop the transaction until further notice.

I 100% agree that its so much easier with a cash buyer, buyer with private funds followed by hard money then conventional.

No, I don't offer any short term loans but do have friends that do.  They are still treated like normal loan and must be underwritten because there is no "guarantee" like a transactional loan because the buyer could easily backout or something happen after the first closing if both are simultaneous.  I've done this a few times and got burnt, waiting 3 weeks to 2 months to finally get the 2nd one closed out again after it was expected to just be 2-5 days after the first closing...THINGS HAPPEN

@Adam Macias about your next statement, you're talking about a BLIND HUD, thus not disclosing and otherwise hiding your fee from someone. That means you weren't transparent and afraid of losing the deal because of the money you're making. I've been there, I get it, but there shouldn't be any shame in creating a profit from SOLVING a sellers problem. They clearly were ok with the price you paid, it solved their issue and you're a for profit business. BUT I also get that in some scenarios it is best to simply double close (or in your market do a blind HUD/Settlement Statement and assign) to keep the deal alive and this could also be that your seller is fine with what you made but you have a buyer that is greedy and upset with your profit and could walk away (i'd never sell to a buyer like this anyway) so that would also be a great time to double close or blind hud as you do. and BTW, more and more states are stopping this from happening, so be careful not to only do wholesale deals one way or you may cause yourself some major problems down the road.

Well, clearly you have a business to promote double closes but I'm not a newbie and I'm here to tell newbies double closings come with more headache and costs than they're worth in my opinion. There's very, very, very specific circumstances it's necessary but definitely not when you're starting out. The biggest thing people need to understand is that 99% of the time a seller is not concerned, cares or even knows what an assignment fee is. I know what a seller side only HUD statement is and what a blind HUD statement is. Even without having to do those, again, I'VE YET TO HAVE A SELLER GET UPSET because this only comes up when people believe they're doing something wrong or don't have the confidence in their buyer or confidence in knowing they can wholesale. Just my take. Double closings are barely needed.

Post: Wholesaling With Conventional Loans

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84
Quote from @Lydia R.:
Quote from @Jesse LeBlanc:

@Paul Ketchens ASSUMING you mean that the end buyer has a conventional loan, here is what I've done a LOT, and yes, it's more work but completely doable:

1) Since you should already be transparent with your seller and buyer, this process should be easy.  DO NOT DOUBLE CLOSE OR ASSIGN (in our world, you still are assigning, but continue following along and i'll be more clear).  Allow your buyer to go direct with the seller and on then either on the contract or on an amendment (or on an email with the seller and the closing team) you add your fee.  This way your fee goes on the seller side.  

So for example, you planned on buying the property from the seller for 100k and selling to end buyer at 115k.  You would draft up the contract for the end buyer in their name as the buyer for 115k, then on an amendment (or email with seller and closing team) 15k to be added to the sellers side as your fee, this way the seller still gets their 100k and buyer paid 115k.  What this does is STOP the end buyers lender from questioning anything.  

By anything, I mean DEPENDING on the lender, they will look at the current owner of the property and if you were double closing, they'd see the seller on the contract is the current owner and stop their loan.  Then if that didn't happen but they saw an assignment fee on the buyers side, they may not approve the loan to cover the assignment fee.  They DO NOT care what is owed from the seller, so your fee is like a lien basically and the end buyers lender doesn't care about that, they only care about the property and what the buyer (their client) is paying for it.

2) IF you tried to double close or assign the contract vs the way I explained above, then you MUST have the end buyer talk with their lender.  Explain what all you're doing and get approval from them first.  Sure, you could be opening up a can of worms BUT it MIGHT be better to find out they won't approve and they'd find out later anyway then stop the loan SOMETIMES on the day of closing!!!  Ask me how I know :)    Hints, for me I go with my first suggestion above so that A) I don't open up a can of worms B) waste time and cause extra work when it could have been solved day 1.

@Lydia R.This too will also solve your concerns so you don't have to pass up on a potential solid buyer, although it's case by case as you know!  You might have a conventional buyer but very very difficult seller, and even though this buyer might pay more, it's just not worth the headache so take less money and go with a different buyer. But yes, another way is to double close and use transactional lending which I offer, BUT I think it will be unnecessary expense and then too much risk in the event the end buyers lender reviews RIGHT BEFORE they send the wire and notice then backout and you're stuck with the property to find another buyer when it all could have been resolved from the start.


 Thanks for sharing this. I have a few questions. I understand about transparency, however when working with sellers that are in financial distress, its a hard pill to ask them to swallow that 15K *using your example) they could be putting in their pocket is now going to your pocket. Especially if they are not making that much from the sale. Second, where is the protection for the wholesalers fee if the contract is written between the seller and the end buyer? Whats to stop the seller from saying they dont agree to the wholesaler receiving a fee? They would rather keep the money for themselves so what stops them from saying, hey thanks for making me an extra 15K? 

Is an extended double close not a possibility? I have had other wholesalers tell me that if the title docs are prepared showing the wholesaler as the seller the bank will move forward with the loan to the end buyer. Ive never done this myself, but I have spoken to others who have done it. 

My personal preference is an end buyer with cash or hard money. It seems like a lot more hassle and risk trying to work with a buyer that has to get a conventional loan. Unless there is a big potential fee, it seems like it makes more sense to find a buyer with an easier/faster funding source. 

Do you guys offer any kind of extended transactional funding--3-7 days or only same day funding?

There's a common misconception that sellers are losing whenever they sell a distressed house. Most wholesales I've done, the sellers are walking away with $75,000.00 from the equity they sold in the house at a minimum. That's quite a bit of money for a house they didn't take care of and didn't care to want.

 The importance of an assignment of contract is you're assigning a contract between you and the seller. There is no you told the buyer about it and then hope for the best. Your security in making sure you're paid an assignment fee by the title company is the contract itself you assigned.

The seller and the buyer both receive different HUD statements. The assignment fee is not on the seller's HUD statement in my experience. Most sellers have no clue what you're even talking about if you try explaining wholesaling and all these guru terms created in real estate. This is more a problem in a person's confidence and proof of concept in thinking they're doing something wrong. You're not doing anything wrong. Assignments are everywhere in contract law. It's not special to wholesaling.

Post: Real Estate license if not planning on being a realtor?

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84
Quote from @Seth Michael Carp:

This summer I would have ample time to work on getting my real estate license and have been considering doing so. I plan to use the license to save on realtor fees and get access to the MLS for house hacking that I will be starting in my sophomore year of college, (still a high school senior). I've heard some people on the forums say that getting your license is a waste of time if your not going to become a realtor and that working instead of getting my license may be a better use of my time to raise capital. I'd appreciate any advice.

There's so much software available for MLS and real estate data from websites now I can list at least 5 that provide everything you need data wise. Yes, they cost a monthly fee but there's no brokerage you need to abide to or yearly dues. For me personally, I love agents (Yes I mean it not just because I'm on BiggerPockets haha) I just couldn't do it based on my intentions and exit strategy of a deal.

It's like when people ask me about if they should get a license to wholesale real estate. Only if absolutely necessary because the law requires a license. Otherwise, if your intention is to not represent clients, there's no reason to waste money or time getting a license.

Post: Is it possible to mass text skip traced leads?

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84
Quote from @Arsh M.:
Quote from @Adam Macias:
Quote from @Arsh M.:
Quote from @Adam Macias:

I prefer cold calling over text messaging any day of the week for several reasons. One of them being you know the person's intentions right off the bat when they answered the phone. You can pick up nuanced details like if they're negative, motivated or even willing to speak with you.

Put yourself in the mind of the homeowner. We as marketers in wholesaling sure love to do stuff that we don't like done to us.

There's marketing strategies way better than cold calling and mass texting but even when someone says, "yes I'm selling my house" you STILL have to speak with them on the phone and meet them in person so texting just gets in the way, creates skepticism that doesn't need to be there in the first place and look at all the legal issues you have before even starting. Just my take.

I know and you’re 100% right. I’m actually a salesman by trade and am used to cold calling. But something about cold calling my first list of property owners and trying to get them to sell to me at a cheap price rattles me. 

 It's the call reluctance. Which is extremely easy to get over. I've made videos on this before. The biggest thing is to realize without chemistry, there's no chance of getting a deal. You have full power to hang up on people if nothing is there. If someone cusses you out, immediately hang up and don't give it a second thought. If someone is playing games or is a nasty Realtor acting like a seller, hang up and move on. There's no law saying it's illegal and it's not immoral to hang up on negative people who have zero interest in selling a house.

Only stay on the phone with people who actually want to talk to you. Your intuition and gut feeling developed hundreds of thousands of years before being "nice" ever did. So trust it when you make your calls. The analytical mind and our ego are what give us call reluctance because we think if someone is not interested we did something wrong. You don't have time to create a sale, you're looking for deals not creating them.

My goal is to make 20k assignments on every deal I take on based on ARV - 70% - repairs - assignment to arrive at my offer price. 

is it realistic to be working in such a fashion? I’d rather take 1-2 deals at 20k a piece per month then. 

is the 70% rule antiquated? Because after I subtract everything my offer is typically 50-60% which obviously isn’t the most enticing. Is it just a pure numbers game and I need volume of offers simply? I over analyze ****

 Do you have a list of investor buyers yet?

Post: Is it possible to mass text skip traced leads?

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84
Quote from @Arsh M.:
Quote from @Adam Macias:

I prefer cold calling over text messaging any day of the week for several reasons. One of them being you know the person's intentions right off the bat when they answered the phone. You can pick up nuanced details like if they're negative, motivated or even willing to speak with you.

Put yourself in the mind of the homeowner. We as marketers in wholesaling sure love to do stuff that we don't like done to us.

There's marketing strategies way better than cold calling and mass texting but even when someone says, "yes I'm selling my house" you STILL have to speak with them on the phone and meet them in person so texting just gets in the way, creates skepticism that doesn't need to be there in the first place and look at all the legal issues you have before even starting. Just my take.

I know and you’re 100% right. I’m actually a salesman by trade and am used to cold calling. But something about cold calling my first list of property owners and trying to get them to sell to me at a cheap price rattles me. 

 It's the call reluctance. Which is extremely easy to get over. I've made videos on this before. The biggest thing is to realize without chemistry, there's no chance of getting a deal. You have full power to hang up on people if nothing is there. If someone cusses you out, immediately hang up and don't give it a second thought. If someone is playing games or is a nasty Realtor acting like a seller, hang up and move on. There's no law saying it's illegal and it's not immoral to hang up on negative people who have zero interest in selling a house.

Only stay on the phone with people who actually want to talk to you. Your intuition and gut feeling developed hundreds of thousands of years before being "nice" ever did. So trust it when you make your calls. The analytical mind and our ego are what give us call reluctance because we think if someone is not interested we did something wrong. You don't have time to create a sale, you're looking for deals not creating them.

Post: Is it possible to mass text skip traced leads?

Adam Macias
Pro Member
Posted
  • Agent Sales Representative at BiggerPockets
  • Fort Collins, CO
  • Posts 154
  • Votes 84

I prefer cold calling over text messaging any day of the week for several reasons. One of them being you know the person's intentions right off the bat when they answered the phone. You can pick up nuanced details like if they're negative, motivated or even willing to speak with you.

Put yourself in the mind of the homeowner. We as marketers in wholesaling sure love to do stuff that we don't like done to us.

There's marketing strategies way better than cold calling and mass texting but even when someone says, "yes I'm selling my house" you STILL have to speak with them on the phone and meet them in person so texting just gets in the way, creates skepticism that doesn't need to be there in the first place and look at all the legal issues you have before even starting. Just my take.