All Forum Posts by: Casey Carroll

Let me step in real quick, because I've also had the (unfortunate) privilege of entering into a discussion with Vincent on a facebook page.

I've actually been investigated for unlicensed broker activity in Colorado, Washington, and Oregon. Each of the three investigations were unpleasant, and time consuming - but I didn't receive a a penalty, have charges levied against me, or anything of the sort after the investigations were completed.

And yet, when I spoke with Vincent about this, he adamantly told me I was wrong, got personal with me, and became incredibly aggressive and hostile. What? 

(As a disclaimer, I am planning on getting my license within the next few months to quiet any sort of unlicensed broker claim about me. Even though I know I'm legit, the cost of getting a license is far worth it than to endure and endless stream of investigations).

Vincent has ulterior motives, because he has a course, podcast, and mentor program talking about "getting the deed" before marketing the home. This is also a fantastic strategy, and also quiets any sort of unlicensed broker activity claim against you - but it's not the only way to wholesale, and he seems to view the investing world as a "Zero-Sum Game," when the majority of other investors understand that this community works far better when we work together and help each other, not sling mud at other gurus who teach a different way of investing than you do.

I just stumbled upon this thread and wanted to put in my $0.02. 

An assignment of contract is not illegal in the state of Oregon. I can speak on this personally because I've actually been investigated by the state of Oregon for unlicensed broker activity (and didn't face any legal repercussions). I know @Cody Cox very well, and also moderate the "Deal Analysis and Discussion" meeting for the NWREIA that Cody used to be the president of.

The most imperative words that @Ned Carey mentioned was "for another, or on behalf of another." 

These words are crucial, because the entire legality of wholesaling (aka assignment of contract) hinges upon these words if you are unlicensed (like myself).

Assignments in general fall more under contract law than real estate law, because a wholesaler does not sell real estate. I technically don't sell contracts either. An assignment is a completely different story, because a willing buyer is willing to pay me a fee for the right to take my place as a buyer. I didn't sell my contract to them - they paid me (the buyer) a fee to take over my place as the buyer. There is no commission involved at all, so remove that language from your vocabulary. 

Time and time again people say "Wholesaling is illegal," or they say "wholesaling is legal." After surviving investigations for unlicensed broker activity in the states of Oregon, Washington, and Colorado, I can say definitively that an assignment of contract is not illegal. I can't comment on double closings as a viable solution either because I have no experience with the investigative process on that specifically - my experience is only per the assignment of a contract.

Your paperwork is very important. You must clearly stipulate in your contracts that you are not a licensed realtor and do not represent anyone but yourself. I am a principle in every single transaction that I do, and when I assign my position as a buyer, I'm doing it for me. Every single ounce of marketing that I do to find a buyer is for me - not for another or on behalf of another.

If you talk to 10 attorneys they will have 10 different opinions. They can argue any side of the fence if they'd like to, because that's what they're paid to do (I know this well because my dad is an attorney and he can argue any side of an argument if he wants to).

WITH THAT SAID, no matter how legal an assignment of contract is, at any point you can become investigated for it, and you have to go through that process again. It's time consuming and there is a massive "pucker factor." Flat out, it sucks. Also at any point you can be sued by anyone for any reason, and even if you're innocent you'll have to defend yourself. You will prevail, but it will come at an enormous emotional and time toll. So is it worth it? You be the judge. If becoming licensed makes you feel more comfortable, then do so - but if you assign a contract while you're licensed, you're still not representing anyone but yourself so it's the same thing, just with a license to back you (and that license would halt any investigation immediately, so the peace of mind is almost worth it). The choice is yours.

 My original mentor, Joe Crump, lives in the Indy market, and he's told me about these sorts of deals and numbers all the time. It's a shocker to me, because I legitimately couldn't even buy 1/3 fractional interest in a dingy condo in my town for that price on the entire duplex.

There are a few metrics to consider when evaluating RESI rentals (not commercial. Anything under 4 units and below is resi).

1. What is my cash on cash return? If you pay full cash and don't finance, you'd be looking at an annual cash on cash return of 36.7% annually. Not bad at all! Unless you can find a better return on your capital elsewhere, this is great (even better if you are able to get a smaller loan and leverage into several homes that are all appreciating, depreciating, and cash flowing simultaneously).

2. What are my expected repairs? If the seller says no repairs needed right now, that doesn't mean there won't be needed repairs within the next 1-2 years. If you're not familiar with inspecting homes yourself, then hire an inspector (only after you've put the property under contract first). 

3. What is the neighborhood like? Is it a high crime area? A warzone? What do the homes within that neighborhood look like? If you buy rentals in the hood, you're going to find tenants who either also want to live in the hood, or are desperate because they can't find anywhere else that will rent to them - evictions, awful credit, etc.

4. Stay true to your exit strategy. If your strategy is to cash flow forever and never sell it, then make sure there aren't any factors within that area that may impede on this. Being next to a warzone (unless the city commission is planning some sort of gentrification project), will likely mean that your home could be a part of the warzone expansion. Try to stay within good school districts (parents of kids really care about this). Stay close to an abundance of jobs - jobs drive rentals. If your strategy is to sell it in a few years, then make sure that there is a very likely chance that the home is going to still be in a sell-able neighborhood a few years from now. 

There are many more ways you can analyze real estate... it all depends on what you're looking for.

Hey now, we don't know it's being sold by a wholesaler. It could be a FSBO situation or a burnt out landlord that wants to get cashed out. I market aggressively to FSBO listings on craigslist in 13 different states. I'd say that less than 1-2% end up being deals sold by wholesalers.

In my opinion, HUD hasn't been good in my local market since late 2012.

dohardmoney

In my area, it only allows me to post to zillow, trulia, and hotpads (all zillow owned websites), rather than the 40+ it used to post to. Plus, it looks like they are going to take my ability away to post sale listings soon too, which is a huge bummer. For a lease option wholesaler like myself, it's a huge benefit to be able to post the same house for rent, and for sale, on dozens of websites. Now, they've limited my rental listing exposure to only three sites (instead of 40+), and it looks like they will be taking my ability to post that home for sale shortly too (because I'm not an agent).

Wow, thanks for the prompt reply! For vflyer, can I post the same home for rent and for sale at the same time? Or do I need to make two active listings per home to accomplish this? If so, that 25 listing limit will be reached often.

Hi folks,

I'm an active lease option wholesaler that does deals in multiple states, and I just discovered today that one of my primary marketing vehicles, postlets, is totally gone and absorbed by zillow.

I would usually make a rental postlets ad, and then a FSBO postlets ad for the same home when I have a lease option I'm trying to assign.

I'm looking for a tool that will automatically syndicate my lease option listings to multiple websites at a time like postlets used to: zillow, redfin, trulia, hotpads, etc.

Can someone please point me in the right direction for a multi site syndication too? All of my for sale listings are totally gone, and I don't want to rely only on zillow to market my rent to own deals.

Thanks in advance!

For text blasting I use callfire.com. To get the data, you can hire a VA to scour craigslist for the types of deals you're looking for, or you can buy a "scraper" that will scrape this data for you. Not sure about text autoresponders actually. When I do a text blast, I will put in a spreadsheet of 3k numbers from FSBO listings in 4 to 5 different states for an entire month, and then I'll have 200-300 motivated sellers call me. You can text them back within the same tool too.