All Forum Posts by: Adrienne Bryson

And yeah you're right grocery store isn't really a good comparison.

Let's break it down for real in an analogy, if houses (move om ready) were bread...

The "market" is the farm. That's where the "wheat" (houses) come from.

Wholesalers are the farmers. They're the ones that go out and get the wheat. They harvest, and separate the good from the bad.

Then come the investors/rehabbers, the "processing plant" where the "wheat" is turned into "bread" (ugly houses are rehabbed).

Then the processing plant ships the bread to the grocery store (rehabbers seller's agent) who them markets the bread to the consumer.

Sure you could farm yourself, process yourself, and market yourself. But having that division of labor allows each entity to have the time and effort to focus on their own specialty. If you're willing to go out and till the soil, good for you.

1. I won't argue with that. Call it what you want doesn't matter to me.

2. Reread what you quoted... I clearly said I'm not in a place to take on RISK or EFFORT. Nowhere did I say I was incapable of closing, add a matter of fact I explicitly said I COULD. I'm just not currently at that place yet. I don't feel like I'm educated or connected enough to be successful at it, so I'm waiting (I plan to purchase my first investment property for myself mid 2017).

By the way I am completely honest with my sellers. I tell them I find deals and usually pass them on to investors. I am fully prepared and capable of closing myself of it comes down to it, and I tell them that too. Don't make assumptions about me.

3. You and the rehabbers you know might not use wholesalers, but clearly SOMEONE does. Obviously someone must, as many make quite a career of wholesaling.

4. I have no reason to comment on your "expectations".

5. I will not speak for all, but *I* offer value by finding off market deals and getting them under contract at a significant discount. You are free to do the legwork yourself but if you don't want to, don't have time to, don't have negotiation skills, etc, that's where wholesalers come in.

I don't hate anything you said. I'm a adult capable of disagreeing without getting my feelings hurt. I'm just trying to offer perspective as an " upstanding " wholesaler. I'm not trying to change your mind and in fact I agree with most of your ideas except I will not lump am entire group of people in with the lowest of them.

"Who would knowingly give away big profits to someone else?"

Um... Lots of people. Rehabbing is a big undertaking, I'll gladly pass on those profits if it means passing on that huge risk and massive effort, neither of which I'm in a place to take on. Same reason car dealerships don't manufacture, and grocery stores don't farm and process food.

"...while adding little to no value to the deal."

I would imagine if the was "no value" to wholesaling, rehabbers wouldn't use them. If investors did their own legwork and found their own deals wholesalers wouldn't exist.

I think a lot of people get into wholesaling thinking it's a get rich quick scheme. They do some immoral, unethical, and straight up stupid things trying to make the $10mil per year the gurus promise... and they ruin the collective reputation of all wholesalers in the process.

The very basics I pretty much learned right here on BP.  There are tons of "beginners" resources that provide all of the general info you need.  The "Ultimate Beginner's Guide" was my first real read (under the education tab in "Guides").  I didn't get into real books etc until I narrowed down my focus.  I'm sure others will be more helpful as far as "general investing" books

I'd say start by learning about the "basics" of real estate investing... For example, what is REI exactly, what are the different types of REI, what are the various REI niches, etc just the general information. From that you should have a decent idea of what appeals to you, what you can get into initially, what your short and long term REI aspirations are, etc and you can narrow your education focus down that way.

Does anyone have experience with using HouseCanary Value Reports?  Have you found them accurate and reliable for evaluating a deal?

Well over the past two days I just read where two different people said on two different posts that FLIPPING isn't investing either.

I guess it all just comes down to that old saying, "Opinions are like..." well you know the rest.

Do whatever you're going to do, and succeed at it.  That's all there is to it.

Another note I thought I might add from personal experience...since you seem worried about EMD and having time to find buyers (like I was at first)... Try focusing on sellers that are motivated to sell but not in desperate need of cash.

For example, a seller that is facing imminent foreclosure is definitely going to want to close ASAP and will want as much cash as they can get for the deal, and will be enticed by the guarantee of $2000 (or whatever) no matter what happens with your deal.

On the other hand, a seller that wants to offload their rental property because they're tired of being a landlord will want to sell, but won't likely be dealing with a time crunch, so they'll be more flexible with both the closing date and the EMD. And if the property wasn't on the market originally, they won't be as concerned with the amount of the EMD.

"Should I find cash buyers first before I make a deal or put the property under contract and then find a cash buyer?"

Some people say you need a long list of buyers before finding deals... At the very least you should know a few buyers and make sure that you're getting deals that those buyers would be interested in.

"How long from when you actually sign the property under contract do you have to close on it?"

You and your seller will set a closing date when you sign the contract.  If you close yourself that date can be within days of signing, or if you plan to assign you will most likely set closing date 15-30 days or more to give yourself time to find a buyer.

"Is there any money due up front when getting the property under contract?"

Not necessarily.  It's a good idea to put some earnest money down when the contract is signed (deposited with the title company).  Some wholesalers give themselves more time in their contract by including verbiage that allows the earnest money to be deposited any time before closing.  It's an option but I wouldn't recommend it unless you are fairly confident you can move the property in a very short time frame.  It's simply not fair to the seller for you to tie up the property for a month with no compensation if you back out last minute.

The amount of money considered "fair" for earnest money depends on the area, the market, and the seller. Some sellers will get offended if you offer less than $5000 EMD, some are more flexible and open to small amounts. And if the purchase price is only $20,000 a $50 deposit might be enough or you could get away with $10 or even $0.

"Am I able to get out of the contract if the buyer I have lined up backs out of the deal?"

Depends on your contract. Many wholesalers have what's called a "weasel clause". Basically a clause that makes the offer contingent on either getting financing or approval from partner(s) - the "partner" would be your end buyer - which gives you a way to void the offer if you can't move the contract. If you back out you will forfeit your EMD.

"Or what if I never find a buyer to purchase the property?"

This is why you should be in contact with at least a handful of active buyers.  Now active is the key word.  There are people that claim to be cash buyers and never actually buy anything.  If you have, say three buyers that are regularly buying 3 bedroom houses in zip code 12345 and you found a 3 bedroom house in zip code 12345 and were able to get it under contract at a price where the buyer will make their desired profit, you shouldn't have a hard time moving it.

You can network with other wholesalers too.  If you are having a hard time finding a buyer yourself, you can either sell the contract to one of those wholesalers (if you have a good enough spread) or share the fee with that wholesaler if they bring a buyer that closes.

"Am I now liable to go through with the purchase myself?"

You don't have to go through with it. That what the contingencies ("weasel clauses") are for. But again you will lose your EMD if you back out.

Or, you could just close on it and give yourself a little more time to find a buyer.  Maybe you could even "spruce it up" a bit to add value while you're holding it.

Welcome!